Indian stocks jumped higher Thursday after government inflation readings backed off from three-year highs. India's wholesale price index rose to 7.14% in the 12 months ending April 5, compared with the prior week's rise of 7.41% and just shy of consensus forecasts of 7.19%. India's central bank also announced it's raising its cash reserve ratio to 8% from 7.5% in two phases ending on May 10.
"The action had to be done immediately and it has been done. The Reserve Bank of India's intention is to squeeze out the current liquidity," said Krish Ramkumar, of Sundaram BNP Paribas Asset Management.
Dealers in the region said the equity rally was sparked by short-covering with bearish traders heavily positioned for a higher inflation number. The Bombay Stock Exchange's benchmark 30-stock Sensex Index rose 237 points, or 1.5%, to 16,481 points. Indian equity markets will be closed Friday for a public holiday.
Bangalore-based information technology company
(WIT - Get Report)
and U.S. software giant
(MSFT - Get Report)
announced an expansion of their strategic alliance with the launch of two Wipro Centers of Excellence to display Microsoft technologies at Wipro's centers in Bangalore and Mysore, according to a company press release. American depositary shares of Wipro fell 1.1% to $11.79.
Indian telecom service provider
Mahanagar Telephone Nigam
said it will offer free downloadable software developed by
that will help customers track stolen mobile phones, according to
. The software called Lost Mobile Tracking Systems (LMTS) can be installed on more than 250 models of mobile handsets and will debut its launch in Mumbai, Navi Mumbai and Thane. Shares of MTE finished essentially flat at $5.14.
According to a report from
, India's auto giant and largest truck maker,
, is planning to bring to market a crossover vehicle. Sources close to the situation said the new vehicle will compete against
Chevrolet Tavera and will be produced at its plant in Pune. A Tata Motors spokesperson said, "The company, as per policy, does not share information on future product launches." Shares of Tata Motors finished essentially flat at $15.56.
In the Indian financial sector,
CEO Kandapur Kamath said the banking giant wasn't planning on listing its brokerage division Icici Securities any time soon. "We will look at it at an appropriate time," Kamath said to reporters at a banking conference in Mumbai, according to
. Kamath also said that Icici Bank would wait for the Reserve Bank's policy statement before making any decisions on its interest rates. The Reserve Bank is set to release its policy statement on April 29. Shares of Icici dropped 1.5% to $41.25
Be sure to check out the
Far East Portfolio
at Stockpickr.com every night to find out which stocks in India and China are making big moves and announcing major news.
Stocks in Hong Kong ignored the central bank's decision to raise the reserve requirement ratio Thursday and rallied higher while shares in mainland China fell to the lowest level in more than a year. Late Wednesday, The People's Bank of China announced it plans to raise the reserve requirement ratio by 50 basis points on April 25 in an effort to cool off the supply of liquidity to major lenders. Dealers in the Far East said stocks in Hong Kong are now tracking the U.S. stock market momentum and investor sentiment is turning more bullish.
"The (China) central bank's latest move signals that there is no pressing need for additional monetary tightening other than raising the reserve requirement ratio," said Wilson Wong, an analyst at Tai Fook Securities.