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Indian Shares Post First Weekly Gain in Three on Banking, Auto Boost

BENGALURU, June 24 (Reuters) - Indian shares marked their first weekly gain in three on Friday, lifted by sharp gains in automakers and financial stocks, as a slide in commodity prices offered some respite from broadening inflationary pressures.

The NSE Nifty 50 index closed 0.92% higher at 15,699.25, while the S&P BSE Sensex climbed 0.88% to 52,727.98. Both the indexes posted weekly gains of 2.7%.

"The recent correction in the prices of several commodities, especially industrial metals, is providing some light at the end of the tunnel with hopes of some of the inflationary pressures easing out," said Milind Muchhala, executive director at Julius Baer India.

Prices of copper, a bellwether for economic output with its wide range of industrial and construction uses, are headed for their worst week in a year, while oil prices have slid on concerns over a slowdown in demand.

"The combination of softening inflation and a weakening economy can put the global central banks on some sort of a back foot and go less hawkish in their tightening cycle going ahead, which will be supportive of equities," Muchhala added.

The Nifty and the Sensex had fallen for two straight weeks on concerns of central bank aggression amid surging inflation.

The Nifty Auto index climbed 2% to an over three-week high on Friday after jumping 4.4% in the previous session, with Mahindra and Mahindra rising 4.6% to a record high. The Nifty FMCG index advanced 1.2%.

The Nifty Bank index rose 1.5%.

Shares of ONGC climbed 1.9% after the oil explorer said its unit struck oil in an onshore block in Colombia.

Hero MotoCorp closed 3.2% higher after the two-wheeler maker said on Thursday it would hike prices by up to 3,000 rupees to counter rapid inflation.

Reporting by Chris Thomas in Bengaluru; Editing by Maju Samuel

Source: Reuters

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