Indian stocks climbed to a ten-week high amid speculation the central bank will add to yesterday’s reserve-requirement cut to stimulate economic growth.
Coal India Ltd. (COAL), the world’s biggest producer of the fuel, jumped 3.9 percent, the most in two weeks. Tata Motors Ltd. (TTMT), the owner of Jaguar Land Rover, reached an eight-month high. Reliance Industries Ltd. (RIL), the country’s most valuable company, gained for a second day. State Bank of India extended an 11-day, 24 percent rally.
Experts say sentiments have improved and helped most global markets. They still have a bullish stance on the Indian market.
Attractive valuations!
Even after the recent rally, expect believe that the valuations in India are not too expensive.
S Naren, CIO equity of ICICI Prudential still believes that valuations on the small and midcaps are pretty attractive. According to him, although largecaps have done very well in last 25 days, they are still very cheap on historical basis and they have more upsides. “All we require is triggers from the government. Most of it is likely to come in the month of March and not in February,” he adds.
Lenders Rally
Housing Development Finance Corp. (HDFC), the biggest mortgage lender, jumped 1.2 percent to 709.2 rupees, the highest close since July 8. State Bank rose for a 12th straight day, gaining 0.8 percent to 2,058 rupees, its longest winning streak since September 2005 and the highest price since Aug. 23. The BSE India Bankex Index (BANKEX) climbed to its highest level since Oct. 31.
Budget: Might be the next trigger!
Experts say Budget will be the next trigger for the Indian market. Naren says, the real big news, other than corporate numbers, is going to be in March. “March is going to be very hectic; you have election results, Budget and monetary policy. On the whole, I think we are all happy in the market for what has happened in January. I think slowly sentiment has improved and helped most global markets. India, as a current account deficit market, has been the biggest gainer because it was one of the worst performers of 2011,” he adds.
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