Indian share prices extended their gains for a third straight day to close up 0.41 percent on Monday led by domestic funds, dealers said. They said domestic funds bought cement, automobile and software stocks and helped push the 30-share Mumbai stock exchange Sensex index into positive territory.
The benchmark 30-share Mumbai stock exchange Sensex opened strong, gaining nearly 1.7 percent, but shed the early gains as investors locked-in gains.
The Sensex ended up 43.79 points to 10,853.14.
But in a sign that overseas funds have continued to exit the market, the rupee weakened against the dollar to a five-month low of 46.06.
Overseas funds invested a record 10.7 billion in Indian equities in 2005 and had helped drive the market to record highs in early 2006, before turning into net sellers in May.
"The markets were relatively less volatile compared to previous weeks. But the trading sentiment continues to be weak in the absence of fresh buying from overseas funds," said R. Balakrishnan, director with Parallex Consultancy Services.