Mumbai: Indian shares rose for a third consecutive session on Monday to close at their highest in nearly one month, drawing comfort after foreign investors bought shares in the previous session, ending a 13-day selling streak.
Foreign institutional investors bought shares worth Rs.1,124 crore on Friday, snapping 13 days of sales, while they also bought Rs.1,691 crore worth of index futures, data from the National Stock Exchange showed, raising hopes this week’s rally would continue.
However, analysts expressed doubts about whether the gains could sustain after volumes on the NSE stock index on Monday fell to their lowest since 19 June.
Shares could find support, should the government unveil reform measures, with expectations of potential action to open up more sectors for foreign investment.
“Out of compulsion, government would have to do a series of reforms for the economy to pick up in near term,” said G. Chokkalingam, executive director and chief investment officer, at Centrum Wealth Management.
The benchmark BSE index, Sensex, rose 0.94%, or 181.58 points, to end at 19,577.39, marking its highest close since 3 June.
The broader NSE index, the Nifty, rose 0.97%, or 56.65 points, to end at 5,898.85, gaining for a third day. Gains were also helped as Reliance Industries Ltd (RIL) rose 2.7%, extending recent gains after the government recently approved a hike in gas prices.
United Spirits Ltd gained 13.33% after Morgan Stanley Asia (Singapore) Pte increased its stake in the company to 4.76% from 4.02%.
Reliance Communications Ltd rose nearly 12% to their highest level in two-and-a-half years after the mobile carrier said it had repaid foreign currency loans worth a total $1.2 billion.
However, among decliners, Infosys Ltd fell 1.83% after Morgan Stanley said the company may cut its fiscal 2013/14 revenue outlook to 4-6% growth, from the 6-10% growth it forecast in April.