Indian shares rebounded to end higher on Friday, after three sessions of declines, as investors awaited an official announcement later in the day amid expectations of a fiscal stimulus to revive growth in Asia's third-largest economy. The broader NSE index closed up 0.82% at 10,829.35, while the benchmark BSE index ended 0.63% higher at 36,701.16.
The NSE index closed 1.98% lower for the week, as trading was dominated by global economic slowdown worries as well as investor concerns about India's fiscal stimulus. Markets had a volatile session on Friday as investors parsed through a series of headlines relating to a possible economic stimulus, but turned higher after news that Finance Minister Nirmala Sitharaman would hold a press conference at 1130 GMT later in the day.
The Nifty Media index rose 4.4%, gaining the most among the 14 sectoral indexes. Shares of miner Vedanta Ltd were among the top gainers in the index, settling up 5.7% for the day. Index heavyweight Reliance Industries Ltd closed 2.35% higher. Only nine of 50 scrips in the NSE index finished the day in the red. Markets began the day sharply lower before rebounding on a report from Bloomberg News that quoted a government official as saying that New Delhi could announce a rollback of taxes for foreign portfolio investors.
India, Asia's third-biggest economy, is facing a slowdown that has dampened demand for everything from cars to cookies, and Indian markets have slid more than 10% since hitting a peak in June. Stock indexes were set to finish the week about 3% lower, their sharpest drop since early May. Chief Economic Adviser Krishnamurthy Subramanian's comment on Thursday, suggesting that companies should not depend on the government for a stimulus, added to the gloom.
Speaking at the same event in New Delhi as Subramanian, the vice-chairman of the government's top think tank reportedly suggested the government might have to take "extraordinary" measures to tackle the economic slowdown. On Friday, shares in cigarettes-to-hotels conglomerate ITC Ltd were the top loser with a 2% drop. Shares in miner Vedanta Ltd were the top gainer, rising 4.8% after a string of losses this week. Meanwhile, the rupee hit a fresh eight-month low of 72.0475 and was last down 0.18% against the dollar.