Mumbai: India's benchmark stock index rose to a 25-month high after Finance Minister Pranab Mukherjee said the nation's rate of economic growth is "impressive" and may accelerate to the fastest pace in three years.
Reliance Industries, the nation's largest company by market value, surged to the highest in more than nine months after Nomura Holdings advised investors to buy the shares, citing the outlook for "large" earnings growth. DLF, the biggest developer, advanced to a two-month high. The rupee climbed to the strongest in 19-months per dollar as overseas funds bought more of the country's assets.
The Bombay Stock Exchange's Sensitive Index, or Sensex, gained 243.06, or 1.4 per cent, to 17,935.68, the highest since February 19, 2008. The S&P CNX Nifty Index on the National Stock Exchange rose 1.5 per cent to 5,368.40. The BSE 200 Index increased 1.4 per cent to 2,247.48. Stock markets were closed on April 2 for a public holiday.
"Domestic consumption remains strong, which will drive our growth," said Vaibhav Sanghavi, a director at Ambit Capital in Mumbai, who manages funds for wealthy individuals. "The economy is buoyant and strong," he said.
Inflows into India's stock market reached a record Rs834.2 billion (Dh68.8552 billion) in 2009, beating the high set two years earlier in local currency terms, as the biggest rally in 18 years lured foreign funds. Funds sold a record Rs529.9 billion of shares in 2008, triggering a record annual decline.
