India’s benchmark stock index climbed for a seventh day, extending a 2 1/2-year high, on speculation the central bank may say economic growth will be stronger than estimated.
The Bombay Stock Exchange’s Sensitive Index, or Sensex, gained 137.05, or 0.7 percent, to 19,484.01 at 2:09 p.m. in Mumbai, set for its highest close since Jan. 17, 2008. The S&P CNX Nifty Index on the National Stock Exchange rose 1 percent to 5,856.10. The BSE 200 Index advanced 0.7 percent to 2,480.50.
“Investors across the spectrum are of the view India’s economic growth will be sustained,” said R.K. Gupta, managing director at Taurus Asset Management Co. in New Delhi. “That sentiment is reflected in the stock market’s performance and I don’t think there is any fundamental factor that is capable of reversing this optimism.” Gupta declined to say how much he manages or identify the stocks he’s buying.
Faster Growth
Economic reports in the past week indicated both a pick-up in growth and moderation in prices. Industrial production expanded 13.8 percent in July from a year earlier, more than twice the pace in June, a government report showed.
Gross domestic product expanded 8.8 percent last quarter from a year earlier, the most among major economies after China and Brazil. The economy may expand by more than 9 percent in the year through March, Montek Singh Ahluwalia, deputy chairman of the country’s Planning Commission, said Sept. 13. That would be the fastest pace since 2008.
Overseas funds bought a net 26.4 billion rupees ($569 million) of local equities on Sept. 13, the most in three weeks and taking their purchases of the stocks this year to 666 billion rupees, according to the nation’s market regulator.
Inflows from overseas reached a record 834.2 billion rupees in 2009, exceeding the high set two years ago in local currency terms, as the biggest advance in 18 years lured foreign funds. They sold a record 529.9 billion rupees of shares in 2008, triggering a record annual decline.
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