India Stocks: HDFC Bank lifts Indian shares, higher oil prices cap gains

Avenue Supermarts

16/01/2023 05:30

(Updates levels, adds analyst comments)
    By Bharath Rajeswaran
       BENGALURU, Jan 16 (Reuters) - Indian shares rose on
Monday, helped by better-than-expected earnings from the
country's largest private lender HDFC Bank, although higher oil
prices and continued foreign investor selling kept a lid on
gains.
    The Nifty 50 index  .NSEI  was up 0.11% at 17,978 as of
10:40 a.m. IST, while the S&P BSE Sensex  .BSESN  rose 0.26% to
60,407.01. Both the benchmarks had risen over 0.5% during the
session.
    Eight of the 13 major sectoral indexes advanced, with
heavyweight financials  .NIFTYFIN  rising 0.3%.
    HDFC Bank  HDBK.NS  rose 0.5% and was among the top gainers
on the Nifty 50 index, after healthy loan growth helped it post
a jump in third-quarter profit.
    "Strong earnings from HDFC Bank will likely be followed by a
good showing from the entire banking pack, due to uptick in
credit growth, lower provisions and improved asset quality,"
said Siddhartha Khemka, head of research (retail) at Motilal
Oswal Financial Services.
        Khemka, however, cautioned that markets were likely to
be volatile due to extended selling by foreign portfolio
investors (FPI).
  
    Data showed FPIs have sold 150.68 billion rupees ($1.85
billion) worth of equities in 2023 so far.
    Foreign selling in Indian equities was a result of high
domestic valuations, as well as the rising allocations to other
markets like China and Taiwan, which were cut earlier due to
COVID-19 curbs, three analysts said.
        They also flagged a moderation in domestic investors'
buying as a reason for volatility.
  
    Meanwhile, oil prices held near 2023 highs on optimism that
China's reopening will lift demand. High crude prices hurt big
importers like India as they hurt inflation and government
financials.  O/R 
    Among other stocks, Avenue Supermarts  AVEU.NS  slid nearly
4% after reporting its core profit margins fell in the third
quarter due to weak demand.
    The metal index  .NIFTYMET  fell over 1.2% after China's
trade data for December showed a slowdown in industrial activity
on a surge in COVID-19 cases, hurting imports.
($1 = 81.2950 Indian rupees)
 (Reporting by Bharath Rajeswaran in Bengaluru; Editing by Savio
D'Souza and Nivedita Bhattacharjee)
 ((bharath.rajeswaran@thomsonreuters.com, Mobile:
+919769003463))