ndian shares rose for a second consecutive session on Wednesday as bluechips such as ICICI Bank Ltd climbed on hopes that Delhi election defeat may prompt faster reforms by the Modi government through the upcoming federal budget. An upstart anti-establishment party crushed India's ruling Bharatiya Janata Party in a Delhi state election on Tuesday, smashing an aura of invincibility built around Prime Minister Narendra Modi since he swept to power last year.
Markets rallied on expectations that Finance Minister Arun Jaitley will boost capital spending and offer tax breaks to an under-performing manufacturing sector in the federal budget on February 28. The benchmark BSE index rose 0.63 percent to close at 28533.97, while the NSE index ended 0.72 percent higher at 8,627.40.
Delhi election defeat may lead Prime Minister Narendra Modi to spur faster activity to ensure the reforms' impact is visible before the next election cycle, investment banks said. Traders expect Finance Minister Arun Jaitley to boost capital spending and offer tax breaks to an under-performing manufacturing sector in the federal budget on February 28. "Modi's focus on delivery of projects would increase especially in the infrastructure sector for job creation in the economy," said Deven Choksey, managing director at K R Choksey Securities. Achieving fiscal discipline and higher revenue would be key in the budget, he added. Axis Bank Ltd also gained 1.8 percent, while Tata Consultancy ervices Ltd rose 1.3 percent.