Indian stocks volatile ahead of US election, Federal Reserve meet

Bloomberg

India stocks swung between gains and losses as investors braced for the impact of the upcoming US Presidential election on global markets.
The S&P BSE Sensex declined 0.6% to 39,396.84 as of 10:12 am in Mumbai, after gaining as much as 0.7% earlier, while the NSE Nifty 50 Index slipped by a similar magnitude. Both gauges last week capped their worst weekly decline since the end of September.
Volatility in Indian stocks has climbed to its highest level since mid-July, and may surge further on the back of the US election and a Federal Reserve meeting on Thursday. Fresh lockdowns in Europe are also clouding the outlook for a global economic recovery.
“Investors are anxious about the outcome of the US election, but India is likely to be a beneficiary regardless of the result,” said Deven Choksey, a managing director at KRChoksey Investment Managers Pvt. in Mumbai. “The volatility is real, and any correction should be bought into.”
As earnings season continues, 17 of the 31 companies on the Nifty 50 index that have reported earnings so far have beaten or matched estimates. Reliance Industries Ltd. and ICICI Bank Ltd., the most recent to post results, reported earnings that exceeded analyst
estimates.
Meanwhile, a pickup in consumer spending during India’s festive season and a good monsoon point to a recovery in Asia’s third- largest economy, even as it continues to deal with the world’s second-highest number of coronavirus cases.
The yield on the benchmark 10-year government bond increased by one basis point to 5.89% and the rupee weakened 0.4% to 74.37 per dollar.
Twelve of 19 sector sub-indexes compiled by BSE Ltd. falls, with a gauge of energy companies dropping the most. Half of the 30 shares on the benchmark S&P BSE Sensex index fall.
Reliance Industries Ltd. contributed most to the index decline and falls the most, dropping 5.1%, while ICICI Bank Ltd. contributed the most to the index advance with a 4.6% gain.