India's NSE index rose on Friday to a record high for the fourth time this week as software stocks gained after upbeat US and German data raised optimism about the sector's business outlook, while higher global shares also helped. US data, including a jump in existing home sales and a drop in initial jobless claims helped push the S&P 500 to a record high on Thursday. European shares also gained in the previous session after better-than-expected German private sector growth figures.
India's 50-share NSE index rose as much as 0.48 percent to record at 7,929.05, surpassing its previous all-time high hit on Wednesday. The shares marked their eighth day of gains in nine sessions, and a second consecutive weekly advance, as overseas investors' buying spree continued. Foreigners net bought 4.13 billion rupees ($68 million) of shares on Thursday and net debt worth $2.65 billion on Wednesday.
"Reduced geopolitical tensions and optimism on future economic growth buoyed sentiment. Going ahead, expectations on interest rate movements in the US and fiscal reforms in India will drive the markets," said Dipen Shah, head of private client group research at Kotak Securities. Foreign portfolio investors have bought $12.2 billion in Indian equities and $16.47 billion in debt this year on hopes Prime Minister Narendra Modi and central bank Governor Raghuram Rajan will be able to anchor Asia's third-largest economy towards sustainable growth and lower deficit.
The benchmark BSE index rose 0.23 percent, or 59.44 points, to end at 26,419.55. It added 1.21 percent over last week for a second straight weekly gain. The broader NSE index closed up 0.28 percent, or 22.10 points, at 7,913.20, for a weekly gain of 1.56 percent. The positive economic data from the United States and Germany boosted stocks of software exporters such as Infosys Ltd, which rose 1.5 percent, while Tata Consultancy Services ended higher 1.3 percent and HCL Technologies advanced 2.5 percent. Tech Mahindra rose 3.1 percent.
Bank stocks also gained after the Reserve Bank of India said it would conduct more frequent term repos but retained the overall borrowing limit for lenders in a bid to make borrowing more flexible without injecting additional liquidity into markets. HDFC Bank ended higher 1.7 percent, State Bank of India rose 2.3 percent, while Bank of Baroda gained 2.1 percent. Sugar refiners gained after the government raised the import duty to 25 percent from 15 percent.
Bajaj Hindusthan Ltd gained 5.1 percent, Shree Renuka Sugars Ltd ended up 4.7 percent, and Balrampur Chini Mills Ltd rose 1.5 percent. Arvind Ltd rose 1.2 percent after Gap Inc said it planned to extend international presence to India through a franchise agreement with a unit of the Indian company. However, Titan Industries fell 1 percent on profit-taking after surging 5.9 percent on Thursday. Morgan Stanley upgraded the watches and jewellery maker to "overweight" from "equal-weight," citing its potential to gain market share.