Indian shares flat as Reliance losses offset virus treatment hopes

Credit: REUTERS/FRANCIS MASCARENHAS

Indian shares hit a six-month high on Tuesday before giving up most of their early gains, as a drop in index heavyweights Reliance Industries and HDFC Bank countered hopes around U.S.-China trade talks and potential coronavirus treatments.

By Sachin Ravikumar

BENGALURU, Aug 25 (Reuters) - Indian shares hit a six-month high on Tuesday before giving up most of their early gains, as a drop in index heavyweights Reliance Industries and HDFC Bank countered hopes around U.S.-China trade talks and potential coronavirus treatments.

The stocks milestone also came as India's rupee INR=D4 opened around 1% above levels from a day earlier after traders reported a halt in a run of central bank interventions aimed at keeping the currency weak to support its stuttering economy.

The NSE Nifty 50 index .NSEI rose as much as 0.52% to its best since late February in early trading, but was flat at 11,466.35 by 0540 GMT. The S&P BSE Sensex .BSESN was up 0.02% at 38,805.02.

Conglomerate Reliance Industries Ltd RELI.NS and India's largest private-sector lender HDFC Bank Ltd HDBK.NS lost 0.3%-0.5% as investors locked in some gains.

Other banking stocks gained, driving the Nifty banking index .NSEBANK 0.7% higher. ICICI Bank Ltd ICBK.NS, State Bank of India SBI.NS and Axis Bank Ltd HDFC.NS were the top three boosts to the Nifty 50 with gains of between 1.1% and 1.4%.

Analysts said Indian stocks rose due to upbeat global mood on Tuesday, in the absence of any major domestic catalysts, following gains in recent sessions on a slew of better-than-feared corporate earnings and upbeat management commentary.

"The biggest positive domestically has been companies returning to normal at a faster-than-expected speed," said Siddharth Khemka, head of retail research at Motilal Oswal Securities in Mumbai.

"Some pent-up demand may be helping, but the bigger question is whether this demand can be sustained, which, right now, the market is not looking at," he said.

On Monday, the S&P 500 and the Nasdaq hit record closing highs, boosted by an emergency authorisation for plasma treatments in the United States and a report that the U.S. government was considering fast-tracking an experimental vaccine developed by AstraZeneca AZN.L and Oxford University. .N

Other Asian markets followed Wall Street higher, boosted by reports that top U.S and Chinese officials see progress being made in resolving concerns around the Phase 1 trade deal reached between the two countries in January. MKTS/GLOB

(Reporting by Sachin Ravikumar; editing by Uttaresh.V)

((saisachin.r@tr.com; +91 80 6182 2754; Twitter: @sachinr27;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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