Demand for raw materials pushes stocks higher

Mumbai: India's stocks rose to a three-week high as investors speculated domestic growth will remain strong, buoying demand for raw materials, consumer goods and services.

Sterlite Industries (India) Ltd, the nation's largest copper producer, climbed 2.5 per cent. Copper rose in London, ending a three-day losing streak. NTPC Ltd gained for the first time in three days. The power producer is set to buy a controlling interest in an Australian coal field to gain access to the fuel, the Economic Times reported, citing a government official it didn't identify.

"Investors are seeing value in buying Indian stocks," said Alex Mathews, head of research at Geojit BNP Paribas Financial Services Ltd in Kochi, southern India. "It's a good time for Indian companies to buy assets abroad as valuations are attractive." He recommends investors buy shares of Oil & Natural Gas Corp and Maruti Suzuki India Ltd.

The Bombay Stock Exchange's Sensitive Index, or Sensex, gained 280.49, or 1.7 per cent, to 17,022.33, its highest close since May 13. The S&P CNX Nifty Index on the National Stock Exchange rose 1.9 per cent to 5,112.50. The BSE 200 Index increased 1.6 per cent to 2,163.91.

Sterlite gained 2.5 per cent to Rs650.45. Copper for delivery in three months rose 1.3 per cent on the London Metal Exchange on Wednesday after touching its lowest level since May 21. Aluminium advanced 1.2 per cent. Hindalco Industries Ltd, India's biggest aluminium producer, added 2.1 per cent to Rs145.75.

NTPC advanced 2.2 per cent to Rs201.9. The company may pay as much as $1.5 billion (Dh5.5 billion) for a stake in a 720 million-tonne coal field near Perth in Western Australia, allowing NTPC to get as much as 10 million tonnes of coal a year for its plants, the Economic Times reported yesterday.

Larsen & Toubro Ltd, the nation's largest private-sector infrastructure company, rose 1.8 per cent to Rs1,661. Reliance Industries Ltd, India's most valuable company, gained 2 per cent to Rs1,030.8. Maruti Suzuki India Ltd, the biggest carmaker, gained 2 per cent to Rs1,303.5.