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Nifty jumps 6% for the week to touch one-month high
Photo Credit: Reuters

Indian shares rose for the third straight session on Friday and finished the week sharply higher ahead of the release of domestic GDP data, thanks to a broad-based rally driven by institutional buyers.

Consumer goods and drug stocks gained the most, powering the blue-chip NSE Nifty 50 index to a near one-month high and giving it a 6% bump for the week.

The gains followed three consecutive weeks of declines in May as the government's economic relief measures disappointed investors. Overall, the index slipped 2.8% in May.

India's gross domestic product (GDP) data, expected around 1200 GMT, is likely to show the economy grew at its slowest pace in at least two years in January-March, as the COVID-19 pandemic hit already declining consumer demand.

Analysts said institutional buyers made large purchases across a wide basket of stocks on Friday, benefiting from access to greater liquidity as well as driven by hopes that coronavirus infections could peak in India by early July, forcing a full reopening of the economy.

"After the infections start coming down, you have no option but to open the economy," said VK Vijaykumar, chief investment strategist at Geojit Financial Services in Thrissur. "We are likely to witness in 2021 a return to growth and (corporate) earnings."

India has been gradually easing lockdown restrictions, and is expected to announce further guidelines in the coming days.

The Nifty 50 ended 0.95% higher at 9,580.30 on Friday, while the S&P BSE Sensex climbed 0.69% to 32,424.10.

Among individual stocks, Vodafone Idea Ltd halved its gains to end 12% higher after the telecom firm said its board was not considering any investment proposal at the moment, following a report that Google was eyeing a stake in the company.

IT services firm Wipro Ltd jumped 6.8% after announcing a new CEO.

Drugmaker Sun Pharma gained 3.3% after it announced a clinical trial for a pancreatis drug in COVID-19 patients.

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