WSJ:Indian Shares End Higher; Software Stocks Gain On Weaker Rupee
MUMBAI (Dow Jones)--Indian shares closed sharply higher Tuesday, led by buying into software companies, as a falling rupee would boost their export revenue, and Reliance Industries.
The Bombay Stock Exchange's Sensitive Index gained 353.93 points, or 2.1%, to end at 17,099.28, its highest closing level since Sept. 8. It had declined 1.1% Monday.
On the National Stock Exchange, the 50-stock S&P CNX Nifty rose 108.25 points, or 2.2%, to end at 5,140.20.
Trading volume on the BSE rose to INR25.36 billion from Monday's INR22.91 billion. Gainers outnumbered decliners 1,849 to 937, while 130 stocks were unchanged.
"Buying interest was witnessed in software plays and select index heavyweights," said Alex Mathews, head of research at Geojit Financial Services Ltd. "Short-covering toward the close and recovery in some European markets further buoyed sentiment."
Mathews expects the Sensex to find immediate resistance at 17,350, with news flow from the U.S. and Europe dictating future direction.
Software exporters ended higher on hopes the falling local currency could lift their earnings. Indian technology companies get more than half their revenue in dollars and they covert that into rupees as most of their expenses are in the local currency.
The dollar surged to INR48.23, a nearly two-year high, in early trade and was last trading at INR47.97.
The BSE IT index closed 3.2% up at 5,216.16. Infosys gained 3.2% to INR2,437.70 and Tata Consultancy rose 3.9% to INR1,057.90.
Reliance Industries, the largest company by market value, closed 3.7% up at INR851.50. State Bank of India ended 3.8% up at INR1,989.05, aluminum producer Hindalco Industries rose 4.3% to INR150.20 and mortgage lender Housing Development Finance Corp. gained 3.4% to INR675.05.
The gains were mainly because of short-covering, analysts said.
Oil & Natural Gas Corp. bucked the trend to close 2.9% lower at INR261.65, hurt by a Bloomberg News report that cited two unnamed sources as saying the state-owned firm's fuel subsidy bill may almost double in the current financial year.
