(Bloomberg) -- Indian equity bulls were tested but key indexes eked out gains, as investors reviewed a central bank board meeting to assess whether the new governor will align with the government to ease lending controls. The indexes capped weekly gains after rallying a fourth straight day.
The benchmark S&P BSE Sensex added 0.1 percent to 35,962.93 at the 3:30 p.m. close in Mumbai, after swinging between gains and losses. The NSE Nifty 50 Index also added 0.1 percent. Both gauges rose for a second week in three.
The Reserve Bank of India's board Friday bought more time to consider the government's demand for a greater say in the central bank's functioning, one of the issues that had fostered hostilities between the two sides.
Read here for details on the RBI board meeting
Strategist Views
- “Markets will be watching the plan of action to be adopted by the new governor in terms of handling the resolution of the IL&FS default, related liquidity conditions and the sensitive topic of the RBI reserves,” said Jagannadham Thunuguntla, senior vice president and head of research for wealth at Centrum Broking Pvt. in Mumbai.
- Investors can stick with quality stocks backed by strong fundamentals and low debt, he said.
- “Given the ongoing political dynamics and possibility of a change in government at the center, investors would likely settle for safety and quality until May 2019,” Kim Eng Securities India Pvt. said in an investor note on Dec. 12.
- Any positive returns in 2019 could only be back-ended as uncertainty would seemingly preclude a major rally in the first half, analysts Jigar Shah, Neerav Dalal and Vishal Periwal wrote.
- Thirteen of the 19 sector indexes climbed, paced by a gauge of telecom shares, after an India tribunal accepted the wireless carriers' requests against the regulator and directed it to reconsider definitions of a significant market player and predatory pricing.
- Telecom firm Bharti Airtel Ltd. rose the most, climbing 5.3 percent.
- Bandhan Bank Rated New Sell at Ambit; PT 280 Rupees
- United Breweries Rated New Buy at Citi; PT 1,550 Rupees
- Lumax Auto Rated New Buy at IDBI Capital Market
The Numbers
Analyst Notes
To contact the reporter on this story: Ameya Karve in Mumbai at akarve@bloomberg.net
To contact the editors responsible for this story: Divya Balji at dbalji1@bloomberg.net, Margo Towie, Teo Chian Wei
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