Indian stocks surge on Moody's first upgrade in 14 years

Moody's ratings 'extremely encouraging', endorses Centre's reforms, says Jaitley

The "Baa3" rating was the lowest investment grade - just a notch above "junk" status.

"Moody's has upgraded the government of India's local and foreign currency issuer ratings to Baa2 from Baa3 and changed the outlook on the rating to stable from positive", the global rating agency said in a release on Friday, adding that the government's wide-ranging economic and institutional reforms will improve the business climate and foster strong and sustainable growth.

Prior to this rating action, HDFC Bank's BCA and ratings were constrained by India's previous sovereign rating of Baa3 given the bank's significant exposure to the government in common with other Indian banks.

Warriors next up to try to stop Celtics' 13-game win streak
He sat behind the Celtics' bench and received a loud ovation from the Garden crowd when he was shown on the jumbotron. It did even better against a Warriors team that entered the night averaging an NBA-best 119.6 points.

Meanwhile the Sensex closed 236 points higher after the Moody's upgrade, while the NSE index rose almost 70 points. "While a number of reforms remain at the design phase, Moody's believes that those implemented to date will advance the government's objective of improving business climate, enhancing productivity, stimulating investment, and ultimately fostering strong and sustainable growth", it added. While upgrading the rating, Moody's cited reforms like the recently- introduced GST, improvements to the monetary policy framework, measures to clean up non-performing loans and efforts to bring more areas into the formal economy. "The rating agency too has now confirmed it formally, which is welcome".

Moody's noted that, the fading of disruption assisted by recent government measures to support SMEs and exporters with GST compliance, real GDP growth will rise to 7.5 per cent next fiscal, with similarly robust levels of growth from FY2019 onward. The Narendra Modi government has been pitching for an upgrade for quite some time now citing various reforms initiatives.

Moody's also upgraded ratings for a slew of public sector companies - State Bank of India, Export Import Bank of India and Indian Railways Finance Corporation - and the private sector lender HDFC Bank on Friday. It also claimed that India's growth potential superseded that of many other sovereign nations.

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