Fed rate pause powers Indian shares to weekly gains

By Bharath Rajeswaran

BENGALURU (Reuters) -Indian shares began November on a positive note, snapping a two-week losing streak, supported by the U.S. Federal Reserve’s rate pause which triggered a rise in global equities.

The NSE Nifty 50 index and S&P BSE Sensex rose nearly 1% this week.

On the day, the Nifty 50 settled 0.51% higher at 19,230.60, while the S&P BSE Sensex rose 0.44% to 64,363.78.

Real estate stocks surged to a record high and were the top sectoral gainers.

Analysts cited healthy earnings, easing inflation, steady demand and a stable interest rate outlook as factors driving the growth.

IT stocks rose 0.64%, extending gains after the Fed held rates steady on Wednesday with a less hawkish monetary policy stance. IT companies earn a significant share of their revenue from the U.S.

“The Fed’s commentary, which was slightly dovish, has removed a major overhang on Indian markets, which are headed for a rally from now to the end of the year,” said Sanjiv Bhasin, director of IIFL Securities.

The Fed’s rate pause spurred a global market rally, while U.S. Treasury yields eased from multi-year highs. World stocks rose 4.3% so far this week, and are headed for their best week this year.[MKTS/GLOB]

“India will likely attract a lion’s share of foreign inflows into emerging markets if buying re-emerges after the Fed rate pause, due to its growth potential,” said Mayuresh Joshi, head of equity research at William O’Neil India.

Apollo Hospitals Enterprises jumped 5.45% and was the top gainer on the Nifty, after Morgan Stanley estimated 25% upside in share prices over next 12 months.

Titan gained 2.28% after beating profit estimates aided by growing jewelery demand.

Tata Motors, added nearly 2% on a stronger second-quarter net profit and raising margin outlook for its luxury car unit Jaguar Land Rover. Titan and Tata Motors were among the top Nifty gainers.

(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Sonia Cheema and Varun H K)