Indian shares began the month on a positive note led by software firms and closed Wednesday 1.3 percent higher, their best gain in 10 weeks, tracking regional markets which were boosted by a Chinese manufacturing rebound. India's top software services firm Tata Consultancy Services rose 1.6 percent buoyed by its UK subsidiary Diligenta's contracts win totalling 250 million pounds.
Smaller rivals Infosys Technologies and Wipro firmed 2.5 percent and 0.9 percent respectively. The 30-share BSE index gained 1.31 percent or 234.75 points at 18,205.87, with 27 of its components closing in the green. Foreign funds have ploughed $12.8 billion in Indian equities this year, including in the primary market offerings. The benchmark index has added 4.2 percent so far in 2010. Financials rose on optimism after data on Tuesday showed India's economy grew at its fastest pace in nearly three years in the April-June quarter.
Leading lender State Bank of rose 0.4 percent and rival private lenders ICICI Bank and HDFC Bank firmed 1.8 percent and 0.8 percent respectively. Mortgage lender Housing Development Finance Corp bucked the trend and edged 0.4 percent lower. Energy giant Reliance Industries, which has the highest weight on the Sensex, recouped some of Tuesday's losses and closed 1.9 percent higher.
Vehicle makers mostly pushed higher, cheering robust August sales. Top car maker Maruti Suzuki gained 1.4 percent while top utility vehicle maker Mahindra & Mahindra closed 0.3 percent higher. Vehicles maker Tata Motors edged 0.1 percent higher while motorcycle maker Hero Honda bucked the trend and slipped 1.9 percent. Metals stocks rallied as a rebound in manufacturing in China propelled base metals.
Non-ferrous metals producer Sterlite Industries rose 3.6 percent with Nomura upgrading the stock to "buy" from "neutral." Nearly three shares gained for every one that declined in a low volume of 361 million shares. The 50-share NSE index gained 1.3 percent to 5,471.85 points.
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