Rate sensitive stocks gain on Chidambaram comments

BANKS-REALTY-AUTO-INDIA-CHIDAMBARAM:Rate sensitive stocks gain on Chidambaram comments

 

Reuters Market Eye - Banks, auto makers and property developers gain after the finance minister's comments about interest rates being high spark hopes the government will exert pressure on the RBI to ease monetary policy.

The NSE's banking index gains 0.8 percent for a second day of advances: ICICI Bank rallies 1.5 percent, while State Bank of India rises 1.4 percent.

Bank stocks also benefit after P. Chidambaram said the government would shortly announce measures tackling investments into mutual funds.

Tata Motors gains 3.3 percent, while Bajaj Auto advances 1.8 percent as lower interest rates would reduce financing costs for vehicle purchases.

 

DLF gains 1.5 percent, a day after India's biggest property company said April-June net profit fell 18 percent because of high interest rates and slowing home sales.