Business | Markets

Indian shares rally on state banks' rate cuts

Indian shares rose 1.47 per cent on Mondayday to their highest close in more than a month, with the recent return of foreign funds and expectations of more policy steps to counter slowing activity lifting investor confidence.

  • Reuters
  • Published: 23:33 December 15, 2008
  • Gulf News

Mumbai: Indian shares rose 1.47 per cent on Mondayday to their highest close in more than a month, with the recent return of foreign funds and expectations of more policy steps to counter slowing activity lifting investor confidence.

Private-sector banks ICICI Bank and HDFC Bank rose 1.7 per cent to Rs418.45 (Dh32.20) and 2.7 per cent to Rs945.20 respectively.

This followed statements by state-run banks said they would cut rates for small home loans and businesses as part of a government-led initiative to boost growth.

But sector leader State Bank of India slipped in late trade on concerns its margins would be squeezed by the rate cuts. It closed 0.8 per cent lower at Rs1,204.40.

Reliance Industries, India's most valuable listed firm, rose 2.4 per cent at Rs1,338.05.

Aided by foreign fund interest, it has risen 18.2 per cent this month, outperforming an 8.1 per cent rise in the broader market.

The 30-share benchmark stock index rose 142.32 points to 9,832.39, with 23 components rising, its highest close since November 11.

Recovery: Rupee on comeback

The Indian rupee retreated from one-month highs but still closed stronger on Monday as gains in the domestic equity market raised expectations of fresh inflows and offset dollar demand from oil refiners.

The partially convertible rupee closed at 48.05/06 per dollar, off its high of 47.92, its strongest since November 11, but gaining 0.8 per cent from its previous close of 48.43/45.

- Reuters

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