Sensex edges up as govt looks for compromise on GST reform

The gains came after Prime Minister Modi was due to meet with Sonia Gandhi to discuss the GST reform and other bills

Indian shares edged up on Friday as hopes the government would look for a compromise with opposition leaders to pass a key reform on a goods and services tax (GST) lifted sentiment.

The gains came after Prime Minister Narendra Modi's office said Modi was due to meet opposition Congress party leader Sonia Gandhi on Friday evening to discuss the GST reform and other bills to be debated in the winter session of parliament. "I am optimistic something should happen," said Jayant Manglik, president of retail distribution, Religare Securities, adding he was hoping so because "this government is also very keen to get it through and the opposition is also talking about it."

 

The broader Nifty was up 0.41 %, on track for a gain of % percent for the week.

The benchmark BSE Sensex rose 0.44 %, heading for a gain of 0.77 % for the week.

The gains came ahead of the Reserve Bank of India's policy review on Tuesday where the central bank is expected to hold its policy interest rate at 6.75 %.

Gains were led by financial stocks with investors buying beaten-down bank stocks. Bank Nifty, a sub-index of the NSE, has lost about 0.37 % this month.

ICICI Bank gained 2 %, Axis Bank rose 1.83 % and HDFC Bank added 0.62 %.

Logistics stocks, which stand to gain the most from GST, also continued to rise on Friday. Gati Ltd rose 3.7 % and VRL Logistics added 1.3 %.

Shares of SKS Microfinance rose as much as 5.53 % after the lender cut interest rates by 100 basis points to 19.75 %.