Indian stocks advance in wake of railway budget

Mumbai: India's stocks rose, driving the benchmark index higher for a second week, led by Larsen & Toubro Ltd, after the government pledged investment in the nation's railways and left freight and passenger fares unchanged.

Larsen & Toubro, the largest engineering company, added 2.6 per cent. Tata Steel Ltd, the biggest producer of the metal, increased 4.2 per cent on speculation it will avoid higher costs to transport raw materials after the government announced the so-called railway budget.

"It is a populist railway budget," said R.K. Gupta, who helps oversee the equivalent of $128 million at Taurus Asset Management Ltd in New Delhi.

"The market is hoping that the general budget on Monday will also be the same."

The Bombay Stock Exchange's Sensitive Index, or Sensex, added 254.56, or 1.7 per cent, to 14,913.05. The gauge gained one per cent last week. The S&P CNX Nifty Index on the National Stock Exchange gained 1.7 per cent to 4,424.25. The BSE 200 Index advanced 1.6 percent to 1,819.02.