Sensex, Nifty inch higher as rebound in banks offset Reliance slide

Sensex, Nifty inch higher as rebound in banks offset Reliance slide
Courtesy: Reuters

Indian shares edged up on Monday, as gains in banking stocks outweighed a slide in Reliance Industries, triggered by a sharp drop in third-quarter revenue at the conglomerate’s oil-to-chemicals business.

The blue-chip NSE Nifty 50 index rose 0.12% to 14,388.75, while the benchmark S&P BSE Sensex gained 0.05% to 48,902.52 by 0520 GMT.

“Today is a day of volatility after the correction on Friday … It remains a buy on dip market,” said Samrat Dasgupta, chief executive officer at Esquire Capital Investment Advisors in Mumbai.

On Friday, Indian shares ended lower, retreating from record levels hit in the previous session due to weakness in banking and metal stocks.

Billionaire Mukesh Ambani-led Reliance Industries slipped as much as 4.7% in morning trade, marking its biggest intra-day percentage loss in over a month and was the biggest drag on the blue-chip Nifty 50.

The operator behind the world’s largest refining complex reported a 30% drop in its oil-to-chemicals division, but beat profit estimates for the third quarter as it reined in spending.

“The stock (Reliance Industries) had run up quite a bit and this correction was warranted for sometime,” Dasgupta said of Reliance, which gained about 5.8% last week in the run-up to its results.

Bank stocks were among the top boosts on the index, with shares of HDFC Bank rising 2.2% to become the biggest boost to Nifty, while Kotak Mahindra Bank gained 1.3% ahead of its quarterly earnings to be released later in the day.

Shares of Tata Motors, which gained 11.2% last week, slipped 2.25% in morning trade, after the automaker hiked prices of its passenger vehicles on Friday.

Broader Asian shares rose on expectations of a $1.9 trillion fiscal stimulus plan to help revive the U.S. economy.

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