Indian shares ended steady on Friday, skidding from a 7-month high hit earlier in the session, as gains in agriculture-related stocks and automakers were offset by a slump in Idea Cellular Ltd Idea Cellular Ltd plunged as much as 12.1 percent after a report that private equity firm Providence Equity Partners was selling a 3.5 percent stake in the wireless provider.
The broader NSE index ended 0.02 percent higher at 8,220.80, but rose 0.76 percent this week to mark a second consecutive weekly gain. The benchmark BSE index ended unchanged at 26,843.03. Both indexes had earlier hit their highest levels since late October. Shares of Idea ended 11 percent down after Providence Equity Partners sold a 3.5 percent stake in the wireless provider.
The June-September monsoon rains would be 106 percent of the long-term average, the chief of the Indian weather office said on Thursday. Stronger rains could cool down food prices, raising the prospect that the Reserve Bank of India would be more willing to cut interest rates again later this year. For now, the RBI is widely expected to keep the repo rate at a five-year low of 6.50 percent when it holds its policy review on Tuesday, after cutting it by 150 basis points since early last year.
"Expectations of a good monsoon have once again reinforced the confidence among market participants that the growth may come back on a good note, considering the consumerism in the rural side of the economy," said Saurabh Jain, assistant vice president-research at SMC Global Securities. Shares of companies dependent on agriculture rose as hopes of a better monsoon increased expectations of a revival in rural demand. Insecticides (India) Ltd rose 2.18 percent, while Monsanto India Ltd was up 3.07 percent. Hindustan Unilever Ltd rose 1.82 percent. Two-wheeler makers Hero MotoCorp Ltd, Bajaj Auto Ltd, and TVS Motor Co Ltd rose between 1.70 percent and 2.50 percent.