Indian shares soar on techs to new high

Indian shares surged to a new high on Monday, boosted by a rally in software services firms as investors bet on bright growth prospects for the export-focused sector, while the rupee slipped on pricey oil. The 30-issue Mumbai Stock Exchange index scaled a new all-time peak of 7,359.81 points, before ending 1.04 percent higher at 7,347.10 points. The index has gained 19 percent since the end of April.
"Nobody seems to be in a mood to sell. The sentiment is extremely positive and the rally is likely to continue," said Arjun Mudda, chief of operations at Arcadia Shares & Stock Brokers Pvt Ltd.
"Unless there are shocking results from major companies or funds stop buying, this market will continue to move up."
Tata Consultancy Services Ltd, India's top software exporter, jumped 5.8 percent after it announced late on Friday a $100 million contract with a US financial services firm and plans to take over another Tata firm, Tata Infotech Ltd.
Bellwether Infosys Technologies Ltd, with an 11 percent weighting in the BSE index, closed 3.5 percent higher.
The two companies, at the forefront of India's $17.2 billion software services export industry, are seen being key gainers from increased outsourcing by multinationals keen to cut costs by moving work to the country's talented and cheaper workforce.
The rupee eased as demand for dollars picked up on the back of firm prices of crude oil, India's biggest import, and ahead of data showing June's trade deficit widened to nearly $4 billion.
But robust foreign fund inflows into the booming Indian stock market helped check losses and the rupee ended at 43.5450/55 per dollar, down from Friday's close of 43.5175/5225.
Foreign institutional investors have invested about $5 billion into Indian stocks this year, helping prop up the rupee.
Federal bonds rallied as investors cheered a better-than-expected result at the central bank's auction of 50 billion rupees worth of 16-year federal debt.
The yield on the actively traded 7.27 percent bond maturing in 2013 eased to 7.0388 percent, more than 7 basis points down from Saturday's 7.1137 percent close.
Earlier, the Reserve Bank of India (RBI) set a cut-off price of 122.00 rupees at an auction of 10.25 percent federal bonds maturing in 2021, above market expectations for 121.50 rupees.