Financials' rebound lifts Indian shares higher

BENGALURU, Feb 13 (Reuters) - Indian shares rose on Tuesday led by a rebound in financials, while easing domestic inflation and hopes of foreign inflows after MSCI's index revision aided sentiment.

The NSE Nifty 50 index was up 0.43% to 21,709.10, while the S&P BSE Sensex rose 0.55% to 71,465.24 as of 10:33 a.m. IST.

Nine of the 13 major sectors logged gains. Highest-weighted of the 13 major sectors, financials recouped 1.2% after dropping 1.4% in the previous session.

On the flip side, metals lost 2.7%, led by aluminium maker Hindalco, which tumbled 13% after its U.S. subsidiary Novelis' quarterly results. The stock was the top Nifty 50 loser.

As per experts, Novelis' ongoing greenfield facility is facing severe cost escalation, while attributing muted volume growth to lower demand.

Also helping sentiment was India's three-month-low January retail inflation data, which signalled macroeconomic strength.
Meanwhile, profit booking continued in the broader, more domestic-focussed small- and mid-caps . The two indexes lost 1% and 0.1%, respectively, after falling 4% and 2.5% in the previous session.

As per experts, the market could see further migration of allocations from small-caps and mid-caps to large-caps, given the expensive valuations.

Asian markets advanced ahead of a key U.S. inflation reading, which could influence the timing of U.S. rate cuts.

Paytm tumbled 8.5% to a record low amid fears of customer loss after recent RBI regulatory action on the company. Coal India gained 2%, after posting a higher-than-expected third-quarter profit.