India’s key equity indices edged higher on Tuesday as technology shares rose, while a fall in lenders following the Punjab state government’s farm loan waiver in the country’s so-called granary capped gains. Shares of information technology companies including Infosys Ltd jumped tracking an overnight rebound in US technology stocks. Asian shares were also up, with Japan’s Nikkei rising more than 1 percent to a near two-year high, tracking gains in U.S. hi-tech shares as investors bet on solid growth in the economy and corporate profits globally.
“The Indian IT sector is mostly trading at fairly good valuations at the moment, specifically in the mid-cap space,” said Amit Chandra, senior manager and research analyst at HDFC Securities. Short-term triggers such as bonus and share buybacks due from companies such as Wipro Ltd are also boosting overall sentiment in the sector, he added. The Nifty IT index was up 0.6 percent, with Infosys, up 1.7 percent, gaining the most. The stock had fallen in the last three sessions.
Among mid-caps, Mindtree Ltd gained as much as 1.8 percent while Tata Elxsi Ltd rose as much as 2.5 percent. The broader NSE index was up 0.09 percent at 9,666.35 as of 0550 GMT, while the benchmark BSE index was 0.11 percent higher at 31,345.03. However, weakness in banking capped index gains. The Nifty PSU Bank index fell as much as 1.05 percent.
The farm loan waivers for small-and-marginal farmers announced by the Punjab government on Monday are impacting the PSU sector particularly, said Sunil Sharma, chief investment officer, Sanctum Wealth Management. Punjab National Bank was the top percentage loser on the Nifty PSU Bank index, declining as much as 2.5 percent.
SpiceJet Ltd rose as much as 2.9 percent to 128.20 rupees, its highest in over two decades after the budget airline said it has committed to buy 737 MAX 10 planes worth $4.7 billion (303.17 billion rupees) from Boeing Co.