Indian shares stay higher

Indian shares climbed 0.7 percent on Thursday, extending gains to a fourth day, on hopes robust economic growth would boost corporate earnings. Firm global markets also helped the upbeat sentiment. Financials rallied after the Indian cabinet decided to pump an additional 60 billion rupees ($1.3 billion) into state-run banks to improve their capital adequacy and to lift the government's stake in them.
The 30-share BSE index closed up 142.7 points, at 19,992.7, with 17 components gaining ground. The broader 50-share NSE index gained 0.9 percent to 6,011.7. The benchmark had fallen 2.6 percent in November, its biggest monthly loss since May, battered by a series of scandals that most hurt stocks in financial, telecom and real estate sectors.
The scandals - which include issue of telecom licenses at low prices and a bribes-for-loans scam that saw eight financial industry executives arrested last week - will continue to be an overhang for the markets in the near term, analysts said. The market is, however, up 14.5 percent so far this year bolstered by overseas portfolio investments worth about $29 billion. The banking sector index firmed 1.2 percent, also supported by hopes a fast-growing economy and pickup in industrial activity would boost demand for loans.
ICICI Bank and HDFC Bank gained 2 and 1.2 percent respectively. Official data earlier showed the Indian economy grew a better-than- expected 8.9 percent in the September quarter, boosted by robust farm output and manufacturing. Explorer Oil and Natural Gas Corp (ONGC) trimmed gains to 1.9 percent at 1,313.05 rupees by close, after rallying as much as 5.1 percent early after the cabinet approved the state-run firm's proposal for a stock split and a one-for-one bonus issue.
Wipro, the No 3 outsourcer, ended up 2.6 percent after the company said its billionaire chairman Azim Premji would transfer 8.7 percent holding to an irrevocable trust. Dealers said this would likely help improve liquidity in the stock. Metal counters Tata Steel, Hindalco and Sterlite Industries rose 1.4 to 3.1 percent, tracking bullish metal prices in the world markets.
Hero Honda fell 7.3 percent after the Business Standard reported the motorcycle maker has agreed to increase its royalty payments to Honda Motor Co to 8 percent of annual sales in return for a technology makeover and a stake sale by the Japanese firm in the venture.. In the broader market, gainers outpaced losers by a ratio of 1.8-to-1 on volume of about 415 million shares.