Monday, 30 March 2015 16:44
MUMBAI: Indian shares surged nearly 2 percent on Monday, recovering from recent losses with the BSE index posting its biggest single-day gain in two and a half months as lenders such as State Bank of India rose after the central bank relaxed provisioning rules against bad loans.
The Reserve Bank of India on Monday said it would allow banks to set aside up to 50 percent of floating provisions from 33 percent. Floating provisions are the amount that banks set aside that are above the mandatory provisioning requirement against bad loans established by the central bank.
The announcement late in the session spurred additional gains in shares, helping the 50-share NSE index snap an eight-session losing streak in which the gauge lost 4.4 percent, compared with a 1.5 percent gain in the MSCI Asia Pacific Ex Japan index.
The NSE index closed up 1.81 percent at 8,492.30, its biggest single-day gain since Feb. 27. The BSE index ended higher 1.88 percent at 27,975.86, its best daily gain since Jan. 15.
The general sentiment was bullish as markets across the region were trading higher with China stocks nearing a seven-year peak on hopes for more infrastructure spending and policy stimulus, while oil prices suffered further from excess supply.
Lenders rose with the Bank Nifty index up 1.76 percent. State Bank of India added 1.6 percent, while HDFC Bank closed up 2.2 percent.
Recent underperformers also gained. Bharat Heavy Electricals Ltd, which fell 5.3 percent last week, rose 2.6 percent, while NMDC Ltd added 3.4 percent.
Copyright Reuters, 2015
