Indian shares shot up to their best close in three weeks on Friday after the country's top cement producer and bank both posted better-than-expected results, fuelling a market rally that gave the rupee a boost. Indian shares rose nearly 3 percent, extending early gains after leading commercial bank State Bank of India beat expectations with a 20 percent rise in quarterly earnings, boosting the stock by more than 7 percent.
The country's top cement group, Grasim Industries Ltd, saw net profit jump 32 percent, beating expectations. Its shares rose 1.8 percent.
The 30-share Mumbai Stock Exchange index ended at 6,419.09 points, up 3.8 percent on the week. It is down 2.8 percent in 2005, but dealers said investor appetite for local shares appeared to be returning.
"Buying interest is coming back on the good earnings we've seen and the front-line stocks are all moving," said Nimish Shah, chief executive of Parag Parikh Financial Advisory Services.
"Expectations are also building ahead of the budget and foreign funds should also start buying soon, after reallocating their portfolios in January," he added. India's federal budget will be unveiled in late February.
Foreign funds bought a net $45 million worth of shares on Thursday, but are still net sellers for the month. The selling has weighed on the rupee and is part of the reason the currency has shed 0.6 percent since ending 2004 at five-year highs.
The benchmark 10-year 7.38 percent 2015 bond ended at 6.7337 percent, below the previous day's close of 6.7585 percent.
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