Indian equities led region-wide gains on Friday, providing a positive end to May, as better-than-expected economic growth added to existing momentum in the stock market that has rallied 52 per cent so far this year.
The Sensex was trading up 2.7 per cent at 14,681.12, as of late afternoon in Tokyo. That helped the FTSE Asia-Pacific index rise 1.3 per cent to 192.69. The rupee also rallied on the data, rising to Rs47.245 from a low of Rs48.09 on Thursday.
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Markets across the region were higher, egged on by some positive industrial output data from Japan. Output gained 5.2 per cent in April, compared with the month-earlier period, raising hopes that companies had sufficiently reduced inventories and the worst of the economic recession was over.
The Indian economy expanded at a 5.8 per cent pace in the first quarter of 2009, thanks to growth in the finance and property sector as well as a boost from social spending, government data showed.
“The economy continues to have significant pent-up demand for investment, especially in infrastructure and affordable housing,” wrote Goldman Sachs economists in a report. “We therefore see upside risks to our GDP growth forecast of 5.8 per cent for fiscal year 2010. We continue to expect to see the rupee strengthen vis-à-vis the US dollar.”
Tata Consulting gained 4.9 per cent to Rs696, while ICICI Bank gained 1.7 per cent to Rs743.50 Mahindra & Mahindra, the car, farm equipment and parts maker, gained 9 per cent to Rs694.25.
The Hang Seng gained 1.6 per cent to 18,171.00 an eight-month high, as it returned to trading following a national holiday on Thursday. The main sub-index of mainland Chinese shares trading in Hong Kong gained 2.2 per cent to 10,428.19.
Region wide, resource stocks gained on higher oil prices and the continued gains by the benchmark freight costs index overnight bolstered the shares of shipping companies.
Shares of China Cosco, the marine freight company , gained 12.2 per cent to HK$10.60, while Japan’s Nippon Yusen gained 5.3 per cent to Y456 and Kawasaki Kisen rose 6.4 per cent to Y431.
BHP Billiton gained 1.9 per cent to A$34.66, while Inpex, Japan’s oil and natural gas explorer, gained 6.3 per cent to Y771.000.
The S&P/ASX 200 in Australia rose 1.7 per cent to 3,818.10, while the Kospi gained 0.3 per cent to 1,395.89.
In Tokyo, the Nikkei 225 rose 0.8 per cent to 9,522.50, while the broader Topix rose 0.3 per cent to 897.91.
