MUMBAI (Reuters) – The BSE Sensex edged up on Thursday as bargain hunting emerged after recent falls, while Reliance Industries gained after it was seen stepping up a buyback of shares, though sentiment remained hit by the weakening rupee.
The rupee fell to a new record low of 54.60 against the dollar on Thursday breaching its previous all-time low of 54.52 hit on Wednesday, while global risk aversion remained because of political trouble in Greece.
Traders were also on hold for Friday’s earnings results from SBI, Tata Steel and Coal India, which will help determine direction in the near-term.
“Market direction still remains down, today’s rise is more on short covering,” said Deven Choksey, managing director of K. R. Choksey Securities.
“Positive news flow from the euro zone is a must for change in trend of rupee and thus markets,” Choksey said
The main 30-share BSE index closed up 0.25 percent to 16,070.48, recovering after hitting on Wednesday its lowest close since January 12.
The broader 50-share Nifty rose 0.25 percent to 4,870.20 points.
Indian shares have tumbled in May, with the Sensex dropping just over 7 percent so far in May, a much bigger fall than the fall of just below 3 percent for the MSCI Asia-Pacific index excluding Japan.
Whether foreign investors will exit India remains a key concern. Provisional data shows net sales of 10.1 billion rupees in domestic shares over the previous two sessions, but they remain net buyers of 8.56 billion rupees for the month.
Bargain-hunting helped some blue chips on Thursday. Tata Motors rose 0.8 percent, recovering from an over 7 percent drop of Wednesday after posting flat global vehicle sales for April.
CLSA said it would maintain its “buy” rating on the stock, saying it expected earnings results due on May 29 to be “strong” and adding it expected the auto maker to benefit from rising sales and cost-cutting.
Reliance Industries rose 1.3 percent as traders say the company has stepped up the pace of its share buyback programme.
The energy conglomerate has now purchased 14.3 million of its own shares since starting the procedure on February 1, the traders said.
Reliance Industries shares had dropped 9.3 percent this month as of Wednesday’s close as investors remain concerned about its earnings outlook and its gas reserves.
However, among decliners Larsen & Toubro shares dropped 3.51 percent after Nomura downgraded the stock to ‘reduce’ from ‘buy’, citing concern about orderbooks.
Bajaj Auto shares fell 2.42 percent down after some traders expressed disappointment with its earnings, though the motorcycle maker maintained its industry-leading profit margins.
(Additional reportign by Abhishek Vishnoi; Editing by Rafael Nam)