Mumbai: Indian stocks rose as investors watched for signs that a rally could broaden out beyond a handful of large companies.
The S&P BSE Sensex climbed 0.2% to 41,656.4 as of 9:56 a.m. in Mumbai. The NSE Nifty 50 Index also advanced 0.2%. While the Sensex has recovered from a mid-year slump to deliver a roughly 16% return in 2019, the S&P BSE Midcap Index is down about 3%.
Investors have continued to prize perceived “high-quality” stocks of established companies that dominate their own industries, as they are regarded as safer bets at a time when India’s economy is growing at the slowest pace in six years. A potential revival in GDP growth in 2020 is widely expected to reverse this trend.
“We are watching out for the broadening out of the rally, which we expect to happen in the first half of 2020,” said Amit Khurana, director of research at Dolat Capital Market, “The moment fund managers find the risk-reward to be more favorable for mid and small caps, they will start investing in them.”