Wednesday July 23, 09:48 AM
India shares to jump on reform hopes after govt win |
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MUMBAI (Reuters) - Indian shares are set to open sharply higher on Wednesday after the ruling coalition won a confidence vote, boosting hopes the government will revive stalled economic reforms.
After winning the vote late on Tuesday, Finance Minister Palaniappan Chidambaram said the government would work with other parties to push reforms, and senior officials said foreign investment in private banks and insurance firms were on the agenda.
"Look at a 500-point gap up opening on the Sensex," said V.K. Sharma, head of research at Anagram Stock Broking, referring to the BSE index. "It should be a positive day overall as oil has slipped and Asia is also firm."
Nifty futures traded in Singapore were up 4.2 percent at 0345 GMT.
Indian shares traded in the United States jumped on Tuesday after the government victory, which would pave the way for a civilian nuclear deal with the United States.
The Bank of New York Mellon's index of Indian ADRs rose 6.7 percent, its biggest one-day percentage rise in four months. ADRs in ICICI Bank soared 13.1 percent to $33.89 on the New York Stock Exchange.
The BSE index, which rose 1.8 percent on Tuesday to 14,104.20 points, has gained 12.2 percent in four sessions, but is down 30.5 percent in 2008.
"The markets will be relieved now that there is no uncertainty, investors will return to fundamentals like inflation and oil and global markets," Andrew Holland, head of strategic risk group of DSP Merrill Lynch, said late on Tuesday.
Oil, India's biggest import, held at $128.30 a barrel, near a six-week low, while Asian stocks rose on the lower oil prices. By 0345 GMT, the MSCI index for Asia-Pacific markets outside of Japan had firmed 2.2 percent.
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