India's broader NSE index rose to a record high on Tuesday, led by gains in Reliance Industries after CLSA said the conglomerate could report a record profit for the fourth quarter. The 50-share index rose as much as 0.58 pct to 9,008.40, surpassing its previous record of 8,996.60 hit on January 30. Hopes India's weightage in MSCI indexes would increase due to the government's proposal to merge foreign direct investment and foreign portfolio investment limits, also underpinned sentiment.
The benchmark BSE index ended 0.46 percent higher, still 0.85 percent away from its all-time high of 29,844.16 hit on January 30. The NSE index ended 0.44 percent higher after breaching the psychologically important 9,000 level for the first time. Reliance Industries gained 4.2 percent, marking its biggest daily gain since March 7, 2014.
Exporters also rose, led by a 1.9 percent gain in Sun Pharmaceutical Industries after it agreed to buy GlaxoSmithKline's opiates business in Australia to strengthen its pain management portfolio. Sentiment also remained upbeat on hopes the government's move to make no distinction between foreign direct investment and foreign portfolio investment would raise India's weight in MSCI indexes.
Traders await clarity on the central bank's stance on rate cuts after formally adopting inflation targeting and the government pushed fiscal deficit target by a year to focus on infrastructure spending. "Goalpost would soon shift to RBI and interest rates from budget," said Deven Choksey, managing director at K R Choksey Securities, adding the monetary policy framework would bring more certainty for investors. Sun Pharmaceutical Industries Ltd rose 2.6 percent after the country's largest drugmaker by sales said it has agreed to buy GlaxoSmithKline's opiates business in Australia to strengthen its pain management portfolio.