Indian stocks inch up as Reliance hits record high

BENGALURU, June 19 (Reuters) - India’s main indexes rose on Friday, riding on gains in Reliance shares after the oil-to-telecoms conglomerate said it had become net-debt free, taking some focus away from rising coronavirus infections and border tensions with China.

The NSE Nifty 50 index rose 0.89% to 10,180.95 by 0617 GMT, while the benchmark S&P BSE Sensex was up 0.82% at 34,490.85. Both indexes were on track to finish the week higher.

Shares of Reliance Industries Ltd rose as much as 2% to a record high on the company’s announcement of being net debt free after raising over 1.69 trillion rupees ($22.15 billion) over the last few weeks via stake sales in its digital arm and a rights issue.

However, there are widespread concerns about India’s economic growth, which is already languishing at multi-year lows and faces further challenges from rising COVID-19 cases at home and abroad.

As of Friday, COVID-19 cases in India were over 380,500 and deaths were well past 12,500.

“In case, hopes of a V-shaped recovery in earnings growth in the second half of fiscal year 2020-21 does not materialize, the market can face a steep correction,” said Ajay Bodke, chief executive officer and chief portfolio manager (PMS) at Prabhudas Lilladher in Mumbai.

“Caution is being thrown to the winds with market ignoring heightened geopolitical risks and being wildly optimistic about a sharp bounce back,” Bodke added.

Tensions between Indian and China have grown following deadly clashes between the two sides over a contested border.

Financial stocks rose with the Nifty PSU Bank Index , which tracks state-owned lenders, adding 2.5%, while the Nifty Private Bank Index rose 1.6%.

India’s small-cap and mid-cap shares rose over 1% each.

The Nifty realty index, which tracks real estate firms, jumped 4.02% with shares of Godrej Properties Ltd advancing over 4.5%. (Reporting by Chandini Monnappa in Bengaluru; Editing by Anil D’Silva)