MUMBAI—Indian shares ended higher Monday with the benchmark index recording its sharpest percentage gain in a month, helped by positive regional markets and a rising rupee.
The local currency rose further against the U.S. dollar to touch a more than one-week high on expectations of sustained foreign investment in local stocks amid hopes the U.S. Federal Reserve would maintain its easy-money policies. The rupee closed local spot trading at 62.41 to the dollar, compared with 63.11 Thursday.
India's financial markets were closed Friday for a holiday.
The Bombay Stock Exchange's S&P BSE Sensex index closed 2.2% up at 20850.74 points. The 30-stock index had climbed 1.0% on Thursday, ending a seven-session decline that shaved 4.9% off the benchmark since it set a record high at a special short session held on Nov. 3.
On the National Stock Exchange, the 50-share Nifty index ended 2.2% higher at 6189.00 points.
Investor sentiment has been boosted by Reserve Bank of India Governor Raghuram Rajan's comments last week that India was better prepared now than a few months ago to handle a rollback of easy-money policies in the U.S. Also, remarks from Federal Reserve chair nominee Janet Yellen suggested the U.S. central bank should continue supporting the world's largest economy with stimulus.
Elsewhere in Asia, China's Shanghai Composite rose 2.9% and Hong Kong's Hang Seng Index gained 2.7% after China published a broad outline for economic reform. In Japan, the Nikkei ended flat, pausing after a 7.7% surge last week, while South Korea's Kospi closed 0.3% higher.
According to Rakesh Goyal, senior vice president at Mumbai-based Bonanza Portfolio, the crucial deciding level for the Nifty index in the near term would be 6200.
All 13 of the Bombay Stock Exchange's sector indexes ended higher Monday. The bank and capital-goods indexes were the top gainers, up 3.2% each.
HDFC Bank gained 4.2% to 668.55 rupees and rival ICICI Bank ended 2.3% up at 1,073.80 rupees.
Top construction and engineering company Larsen & Toubro rose 3.9% to 976.10 rupees and cigarette maker ITC, the stock that has the highest weight in the Sensex index, closed 3.6% up at 325.75 rupees.
