Indian shares rise as Bajaj Finance boosts financials, crude oil cools

People walk past the Bombay Stock Exchange (BSE) building in Mumbai, India, November 4, 2020. REUTERS/Francis Mascarenhas

BENGALURU, July 6 (Reuters) – Indian shares rose on Wednesday, as gains in top non-banking financial company Bajaj Finance after a strong quarterly performance boosted financial stocks, while easing inflation worries on a slump in crude oil prices also supported sentiment.

The NSE Nifty 50 index (.NSEI) rose 0.42% to 15,878.35, while the S&P BSE Sensex (.BSESN) was up 0.52% at 53,413.16, as of 0455 GMT.

Crude oil prices tumbled 9% on Tuesday, hit by worries of demand destruction, which could bring down inflation for India, the world’s third-largest importer.

“Headline worries still remain the same with regards to a possible recession and high inflation. The markets are positive only on the back of cooling of crude prices,” said Prashanth Tapse, vice-president (research), Mehta Equities.

Market is expecting crude prices to fall below $100 per barrel in case of a recession in global economy, which will substantially bring down domestic inflation, he said.

Interest rates and inflation worries have weighed on Nifty and Sensex, with the indexes falling over 8% so far this year.

The Nifty finance index (.NIFTYFIN) rose 0.8%, while Bajaj Finance (BJFN.NS) gained 3.2% after reporting strong June- quarter numbers.

Bajaj Finance was the top mover and boost in the bluechip Nifty 50 index.

Shares of domestic explorers Oil & Natural Gas Corp (ONGC.NS), Oil India (OILI.NS) and Gail India (GAIL.NS) fell between 2.6% and 6.3%.

The explorers have also come under pressure after the Indian government imposed windfall tax on oil producers. read more

Investors are also keeping an eye on the Indian rupee , which hit multiple record lows recently on concerns over the country’s widening current account deficit. read more

Elsewhere, Asian stocks slipped and the dollar stood by a two-decade high against the euro on deepening fears that the continent is leading the world into recession.

Reporting by Nallur Sethuraman in Bengaluru; Editing by Rashmi Aich

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