MUMBAI (Reuters) – The BSE Sensex snapped a five-day fall on Tuesday as Larsen & Toubro surged after positive results, while an improvement in global risk sentiment and the RBI’s intervention in currency markets helped provide some stability.
The benchmark index has fallen 4.12 percent over the previous five sessions as worries about India’s economic outlook have intensified following poor industrial output data and concerns about inflation.
The domestic concerns have come during a sharp risk-off trade globally because of the political uncertainty in Greece, though European equities inched up somewhat on Tuesday following better-than-expected economic data.
The Reserve Bank of India also stepped in aggressively in currency markets, after the rupee fell to as low as 54.15 to the dollar during the day, threatening to touch a record low of 54.30 hit in December.
However, these are expected to be temporary reprieves, and analysts say the Sensex is liable for more falls after already falling 6.4 percent this month.
“Today’s rise was more due to short-covering because of Larsen’s decent results and rupee gaining strength due to RBI’s effort,” said Prakash Diwan, Head of the Institutional Clients Group at Asit C.Mehta Investment.
The Sensex rose 0.69 percent to 16,328.25, while the broader 50-share Nifty gained 0.71 percent to 4,942.80 points.
Also supporting domestic shares was data showing foreign investors had extended their net purchases to a third consecutive session as of Monday, for a provisional total of 8.8 billion rupees during the period.
Shares in engineering conglomerate Larsen and Toubro rose 5.42 percent a day after reporting stronger-than-expected earnings, while traders also welcomed its guidance of 15-20 percent growth in revenue and order wins.
Recently battered blue chips fell as some investors saw them as good buy opportunities. Infosys gained 3.26 percent, with the stock down 18.4 percent in the quarter started April compared to a 7.32 percent fall in the NSE index.
ICICI Bank rose 2 percent, having dropped 9.3 percent so far in May as of Monday’s close.
BPCL rose 2.1 percent after U.S. partner Anadarko Petroleum Corp said it had discovered a major new gas field in Mozambique.
However, among decliners, Bharti Airtel fell 1.2 percent after a government minister said Indian authorities were investigation the mobile phone carrier under provisions of the country’s money laundering and foreign exchange rules.
(Additional reporting by Abhishek Vishnoi; Editing by Rafael Nam)