Indian stocks swing as investors digest border clashes and infections

Bloomberg

India stocks rose, overcoming early volatility as investors weighed the consequences of a border conflict with China’s military while coronavirus infections continued to rise as the South Asian nation reopens.
The S&P BSE Sensex index rose 0.2% to 33,678.43 as of 12:51 pm in Mumbai, after swinging between gains and losses. The NSE Nifty 50 Index was up 0.2%.
Clashes on a contested Himalayan border on killed troops on each side Tuesday after a weeks-long stand-off in an escalation of a decades-long dispute. Meanwhile, Covid-19 infections continued to rise as India reopens for business after a prolonged lockdown failed to curb the spread of the disease
“Border tensions will affect sentiment because things may turn bad or good and investors won’t want to commit in such uncertainty,” said Umesh Mehta, head of research at Samco Securities Ltd. in Mumbai. “Investors are still not optimistic because of the fear of a second-wave of infections, and concerns about how small businesses will survive.”
The yield on the most traded 6.45% 2029 bond was little changed at 6.03%, while the rupee was steady at 76.1875 per US dollar.
Sixteen of 19 sector sub-indexes compiled by BSE Ltd.
advanced, led by a gauge of telecom companies.
“A big event that can really drive the markets is the matter pending before top court on a loan moratorium,” Samco’s Mehta said. The nation’s top court had asked the Reserve Bank of India and the government to consider an interest waiver as part of the moratorium being offered on repayment of term loans.
ICICI Bank Ltd. contributed the most to the Sensex advance, increasing 1.5% while Maruti Suzuki India Ltd. had the largest gain, rising 3.8%.
ITC Ltd was the biggest drag on the index, declining 1.1%; Mahindra & Mahindra Ltd. had the biggest drop, falling 1.7%.