Mumbai: Markets overcame a choppy early session and climbed for a third day to their best close in five weeks on Thursday, with export-driven software services companies among the gainers in anticipation of U.S. moves to bolster its flagging economy.
A revival in foreign fund buying over the past few days also underpinned the market, which has been one of the worst performers this year due to rising interest rates and slowing growth.
The 30-share BSE index rose 0.59%, or 100.54, to 17,165.54, its highest close since Aug. 5, with half its components gaining.
Sofware services bellwether Infosys , market leader Tata Consultancy Services and No. 3 exporter Wipro , who get most of their revenue from the United States, rose 2.1, 0.5 and 2.6% respectively.
President Barack Obama is expected to unveil a more than $300 billion package to boost jobs in a speech before the joint session of US Congress at 2300 GMT.
Energy major Reliance Industries shrugged off remarks from a government auditor and rallied 2.3%, taking gains over three days to more than 8% on expectations the company will be able to raise gas output.
The Comptroller and Auditor General (CAG) criticised Reliance and the government over development of the country’s key natural gas resource in the Krishna Godavari (KG) basin and called for revamping profit sharing arrangement from oil and gas blocks.
“The CAG report is more onerous on the DGH (director general of Hydrocarbons) and the petroleum ministry rather than Reliance. No serious adverse remarks have been passed against the company,” said independent consultant S.P. Tulsian.
Reliance, India’s largest listed firm, has been under fire in recent months from the upstream regulator, investors and analysts over slowing gas output from its KG blocks, and its shares have suffered.
Earlier this year, Reliance sold a 30% stake in 22 oil and gas blocks, some in the KG basin, to BP in a $7.2 billion deal, in part to benefit from BP’s expertise in deepwater exploration.
Reliance shares, which have the heaviest weight on the main index, are down 19.5% in the year to date, compared with a 16.3% fall in the benchmark index.
Drugmaker Ranbaxy Laboratories ended up 4.1% on reports the company would release a generic version of cholesterol-lowering drug Lipitor in the United States at the end of November as planned.
Banks were mixed on concerns the central bank may again raise rates next week.
ICICI Bank rose 2.4%, while market leader State Bank of India and HDFC Bank fell 0.2 and 0.9% respectively.
The Reserve Bank of India remains bent on fighting domestic inflation despite weakening global conditions, officials with direct knowledge of policymaking said on Wednesday, a week before it is widely expected to raise interest rates once again.
Top engineering and construction firm Larsen & Toubro , Tata Motors and power equipment maker Thermax gained between 1.9% and 3.4% on value buying, dealers said.
The 50-share NSE index, Nifty , closed 0.56% higher at 5,153.25 points.
“We have already seen quite a good up move. Technically, 5,150-5,200 is seen as near-term resistance,” Tulsian said.
In the broader market, there were 1.57 gainers for every declining stock on heavy volume of about 650.88 million shares.
European stocks rose on Thursday, extending the previous session’s rebound as investors bet on a more dovish tone from the European Central Bank, scooping up recently battered banking shares.
At 1042 GMT, the world stocks as measured by MSCI were up 0.29% while the FTSEurofirst 300 gained 0.83%.
The MSCI’s measure of Asian markets other than Japan was up 0.11%, while Japan’s Nikkei gained 0.34%.
Mangalore Refinery and Petrochemicals ended 1.6% higher after its managing director told Reuters the company may boost middle distillate exports by about 80% and halt fuel oil exports from 2013/14 once it completes expanding capacity.
Jaiprakash Associates shed 0.5% after the company said it had not submitted a proposal to dilute up to 26% of its cement business to its restructuring committee.