Bengaluru (Reuters) – Indian shares traded higher on Thursday as stronger-than-expected domestic growth data boosted sentiment and as broader Asian equities rose over receding bets for a rate hike by the U.S. Federal Reserve this month.
The blue-chip Nifty 50 (.NSEI) index was up 0.13% at 18,559 as of 10:30 a.m. IST, while the benchmark S&P BSE Sensex (.BSESN) advanced 0.09% to 62,681.35. Both indexes are near five-month highs.
“The tone in the domestic equities is positive, it’s just that market may face resistance as we are hovering at record highs so it is normal that we see some profit booking at the higher levels,” said Ajit Mishra, Senior Vice President – research at Religare Broking.
Government data on Wednesday showed India’s economic growth accelerated to 6.1% in the January-March quarter, outpacing economists’ forecast of 5.0% growth in a Reuters poll.
Meanwhile, most of Asia-Pacific equities rose, boosted by receding bets for a U.S. rate hike this month and relief over the passage of the U.S. debt ceiling bill through the House.
Also improving sentiment are the continued inflow of foreign funds into domestic equities and a fall in crude prices for the third straight session, which benefit importers like India, where crude constitutes a significant share of the import bill.
Foreign institutional investors (FIIs) bought 34.06 billion rupees worth of Indian equities on Wednesday. They have been net purchases in Indian stocks in 24 of the last 25 sessions.
Among individual stocks, state-owned miner Coal India Ltd (COAL.NS) fell 4.5%, the most on the Nifty 50, after the Indian government proposed to sell up to a 3% stake in the company.