Domestic stock markets extended gains after opening higher tracking fall in crude oil prices in international markets, despite official data showing that India lost its position as the fastest-growing major economy to China for the first time in one-and-a-half years. The S&P BSE Sensex index rose as much as 307 points to reclaim 40,000 mark and the NSE Nifty moved above 12,000, rising 88 points from the previous close. Gains in fast-moving consumer goods and energy stocks supported the markets, however weakness in banking and pharma counters kept the upside in check. Analysts will closely watch the outcome of the RBI policy meeting due this week.
At 11:32 am, the Sensex traded 300 points - or 0.76 per cent - higher at 40,014, while the Nifty was up 87 points at 12,010.
Global oil prices fell more than 1 per cent on Monday, extending losses of over 3 per cent from Friday, when crude markets slipped to their biggest monthly losses in six months amid stalling demand and as trade wars fanned fears of a global economic slowdown. Brent crude futures – the international benchmark for crude oil - were last seen trading 1.4 per cent at $61.12 a barrel.
Brent crude oil prices have dropped almost 20 per cent from their 2018-peak in late April.
Top gainers on the 50-scrip benchmark index at the time were Hero MotoCorp, Bajaj Auto, Asian Paints, Britannia and Indian Oil, trading between 2.08 per cent and 4.92 per cent higher.
HDFC Bank, HDFC and Tata Consultancy Services (TCS) contributed the most to the advances in Sensex.
India's economic growth dropped to 5.8 per cent in the January-March period, government data showed on Friday.
The Reserve Bank of India (RBI) will release its second bi-monthly policy statement of financial year 2019-20 on Thursday.
Two-thirds of 66 economists in a poll by news agency Reuters predicted the RBI to cut its repo rate by 25 basis points at its June 4-6 meeting, bringing it to 5.75 per cent - the lowest since July 2010. It is then expected to keep policy on hold at least until the end of next year.
A rate cut on Thursday would mark the third straight reduction in the key interest rate this year. The last time the central bank cut rates three times in a row was in 2013.
Shares in other Asian markets opened lower, following end of the week losses on Wall Street amid escalating global trade concerns. Japan's benchmark index Nikkei 225 slipped 1.42 per cent, while the broader Topix index was down 1.38 per cent.
US President Donald Trump's surprise threat on Thursday to place duties on all imports from Mexico, beginning at five per cent on June 10 and rising to as high as 25 per cent, rattled world markets on Friday.
The Sensex and Nifty had ended 0.3 per cent and 0.19 per cent lower respectively on Friday, retreating from near record high levels.
(With inputs from Agence France-Presse)
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