* Financials lead gains
* ONGC top gainer
By Krishna V Kurup
May 31 (Reuters) - Indian shares advanced on Thursday as Asian markets rebounded after worries about a political crisis in Italy waned, while expectations that the domestic economy likely gained momentum in the first three months of 2018 buoyed investor sentiment.
Asian stocks bounced back from a two-month trough as a degree of calm returned with the two anti-establishment parties renewing efforts to form a coalition government rather than force Italy into holding elections for the second time this year.
MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.7 percent after slumping on Wednesday to its weakest since early April.
India likely retained its position as world’s fastest growing major economy in the January-March quarter, surpassing China’s growth of 6.8 percent.
Gross domestic product (GDP) possibly grew 7.3 percent in the first three months of 2018, a Reuters poll showed, a touch faster than the 7.2 percent growth in the last three months of 2017 and at the fastest pace since July-September 2016, the quarter before the government scrapped high-value currency notes.
The government will release GDP data on Thursday around 1200 GMT.
The broader NSE index was up 0.35 percent at 10,651.60 as of 0613 GMT while the benchmark BSE index rose 0.38 percent to 35,038.12.
“Market is holding on, in spite of worries around crude and political instability,” said Anupam Singhi, chief operations officer, Marketsmith India, part of William O’Neil India.
“From a medium term perspective, we believe market is right now stable and will consolidate between current level and 11,300 level. (We) don’t see too much of a fall from here.”
Financials firmed up and accounted for most of the gains on the indexes, with HDFC Bank gaining 2 percent and Housing Development Finance Corp inching 0.9 percent higher.
However, shares of ICICI Bank Ltd, the country’s third-biggest lender by assets, dropped after it said it would institute an inquiry into allegations raised by an anonymous whistleblower against CEO Chanda Kochhar.
Among gainers, shares of Reliance Communications jumped 9.1 percent after the Anil Ambani-led company said on Wednesday it expects to complete its asset sale to Reliance Jio Infocomm and Canada’s Brookfield in coming weeks.
Oil and Natural Gas Corp Ltd, up 3.2 percent, was the top gainer on the indexes after the company posted a 36 percent rise in quarterly profit.
$1 = 67.5300 Indian rupees Reporting by Krishna V Kurup in Bengaluru; Editing by Vyas Mohan