November 29, 2018 / 6:42 AM / 8 months ago

Indian shares rise 1 pct after U.S. Fed comments; metals shine

* NSE index up 0.9 pct, BSE index up 1 pct

* Hindalco Industries top gainer

* Yes Bank hits over 2-1/2-yr low on debt downgrade

By Krishna V Kurup

Nov 29 (Reuters) - Indian shares rose 1 percent on Thursday, tracking broader Asian markets that rallied after the U.S. Federal Reserve chairman’s comments were interpreted as a dovish shift, and ahead of the expiry of futures and options contracts later in the day.

Asian stocks tracked a surge on Wall Street, after Fed Chairman Jerome Powell suggested the central bank may be nearing an end to its three-year rate tightening cycle, boosting interest in riskier assets.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.85 percent.

A sharp rise in the rupee to a three-month high against the dollar also added to the positive sentiment. The partially convertible currency was at 69.8975 per dollar after touching 69.88 earlier, its strongest level since Aug. 27.

Investors are also awaiting the release of India’s gross domestic product (GDP) data for the September quarter on Friday.

The broader NSE index was up 0.92 percent at 10,827.55 as of 0622 GMT, while the benchmark BSE index rose 1 percent to 36,075.45.

“There is a good deal of positivity in the market due to expectations of a reduced pace of a rate hike by the U.S.,” said Anand James, chief market strategist at Geojit Financial Services.

But, worries around the upcoming U.S.-China meeting on the sidelines of G20 summit, and domestically, state election results and expected GDP data restricted upside, James said.

“Last couple of days we have seen F&O related moves as well with most of the index heavyweights helped by short coverings. Roll-overs have been tepid now.”

Most metal stocks advanced after base metal prices rose in the wake of Fed comments. Nifty metal index rose up to 2 percent.

Hindalco Industries Ltd, the top percentage gainer on the NSE index, rose as much as 3.9 percent.

Copper and aluminium producer Vedanta Ltd gained nearly 4 percent after an Indian court-appointed panel said there were insufficient grounds to permanently close Vedanta’s copper smelter in Tamil Nadu state and the state government decision to shut it amounted to administrative overreach.

Among the gainers, shares of technology firm Vakrangee Ltd hit the upper circuit after rising as much as 4.96 percent, after an investigation by the market regulator found no stock manipulation by promoter entities.

Shares of Yes Bank Ltd plunged to their lowest in more than two-and-a-half years after credit rating agencies ICRA and CARE Ratings downgraded ratings on the lender’s debt instruments. Stock was the top loser on the indexes, falling as much as 9.5 percent. (Reporting by Krishna V Kurup in Bengaluru; Editing by Gopakumar Warrier)

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