Indian share prices rose 2.52 percent to a new record close on Friday, as investors brushed off concerns of large fund outflows due to new rules limiting the anonymous buying of shares by foreign investors, dealers said. They said capital goods, metal and property stocks rose on hopes of strong earnings reports by Indian companies.
The Mumbai stock exchange's 30-share Sensex index rose 472.28 points or 2.52 percent to close at a new record at 19,243.17, after hitting a new intra-day high of 19,276.45. The previous record close was 19,058.67 on October 15 while the previous intra-day high was 19,198.66 on October 18.
India's stock market regulator, the Securities and Exchange Board of India (SEBI), on Thursday announced new rules to phase out the anonymous buying of shares by foreign investors.
"Buying momentum resumed on hopes that the SEBI regulatory norms will not result in huge negative flow of funds from overseas funds," said Hiten Mehta, a fund manager with Fortune Financial Services. The new regulations primarily concerned participatory notes, which had allowed foreign investors like hedge funds to buy Indian shares without revealing their identity.
Overseas investors have helped drive a stock market boom in India, pumping in a record 17 billion dollars this year alone and helping the Sensex to surge more than 39 percent.