Wires

Indian stocks stage sharp recovery as world markets stabilize on stimulus hopes

Chris Thomas and Chandini Monnappa

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* Nifty, Sensex jump around 4% each

* Financials lead recovery (Updates shares, adds analyst comment)

BENGALURU, March 13 (Reuters) - Indian stocks recovered sharply in afternoon trading on Friday after tumbling earlier in the session as major global markets were lifted by hopes that a U.S. stimulus package could help limit the economic damage from the coronavirus outbreak.

The NSE Nifty 50 index jumped 3.98% to 9,971.25 by 0843 GMT, while the benchmark S&P BSE Sensex was up 4.23% at 34,165.08.

The indexes plunged more than 10% each earlier in the day, triggering a "circuit breaker" for the first time since 2009 as panic over the pandemic gripped global markets. The indexes swung wildly after trading resumed at 0450 GMT following a 45 minute halt.

"Global stocks have recovered, this is helping our markets. The 45-min breather gave people time to think and value buying emerged," said Siddhartha Khemka, head of retail research at Motilal Oswal Securities.

"U.S. stimulus hopes have helped arrest losses for the moment."

India's volatility index was up 19.8% after surging 44% to its highest in over a decade.

The rupee reversed losses to trade about 0.56% stronger at 73.9. It had fallen to a record low of 74.5075 against the dollar earlier in the session.

Sentiment was bolstered as U.S. lawmakers neared an agreement with the White House on an economic rescue package to deal with the fallout from the coronavirus impact. House Speaker Nancy Pelosi said she hoped to announce a deal on Friday.

MSCI's broadest index of Asia-Pacific shares outside Japan clawed back earlier losses to trade a touch higher, while European and U.S. stock futures were in positive territory.

"Markets are acknowledging that they are in the oversold zone so there is some buying support coming in," said Sujan Hajra, chief economist at Anand Rathi Securities.

Lender Housing Development Finance Corp Ltd led the recovery in Mumbai, rising as much as 13.2% and on course for its best day in nearly a decade.

HDFC Bank Ltd jumped 5.9%, following a 10% slide earlier in the session, while public sector peer State Bank of India surged 17%.

Drugmaker Sun Pharmaceutical Industries Ltd climbed 13.6% and was headed for its best day in more than eight years.

The Nifty Pharma index was last up 5.8% and the Nifty Bank Index 5% higher. (Reporting by Chris Thomas and Chandini Monnappa in Bengaluru; Editing by Anil D'Silva)

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