Indian shares rose 5.2 percent on Monday as trading resumed after a four-day break, with investor appetite across Asia boosted by optimism the global economy has turned a corner. Sentiment was helped by a survey that showed activity in Indian factories expanded for the first time in five months in April as a swelling orders pipeline pointed to a tentative recovery.
Energy giant Reliance Industries, and top lenders such as State Bank of India, ICICI Bank and
HDFC Bank bolstered the main index that had jumped 17.45 percent in April, its best monthly rise in 10 years. By 12:28 p.m., the 30-share BSE index was up 592.18 points at 11,995.43, with all its components advancing. It breached 12,000 points for the first time since last October. The benchmark, which has risen 48.5 percent since hitting a 2009 low in early March, is up 24 percent this year after slumping 52 percent in 2008.
"Foreign funds are flush with liquidity and they are fuelling the rally," Jayesh Shroff, who helps manage $1 billion in equity at SBI Mutual Fund, said. "We are following the globe as some macroeconomic data is optimistic."
Foreign funds had moved more than $1.4 billion into Indian shares in April, their biggest one-month purchase since October 2007. Reliance Industries, India's largest-listed firm with the
most weight in the main index, rose 3.4 percent to 1,864 rupees. The stock had jumped more than 18 percent in April on hopes the company's growth in coming quarters will be boosted by
sales of gas it started pumping last month from its deep-sea field off India's east coast.
Private-sector lender ICICI Bank gained 6.2 percent to 507.40 rupees, while rival HDFC Bank climbed 5.6 percent to 1,162.25 rupees. Government-run State Bank of India was up 6.1
percent at 1,355.10 rupees, after it cut deposit rates by 25 basis points on Saturday. In the broader section, advancers led losers in the ratio of 3:1 on relatively high volume of 202 million shares. The 50-share NSE index was up 4.4 percent at 3,626.75. Asian shares were higher after U.S. data on Friday showed consumer confidence had recovered to its best level since September, sparking a rally on Wall Street.
MSCI's measure of Asian markets excluding Japan .MSCIAPJ was up 4.4 percent, while Japan's Nikkei .N225 was closed for a local holiday.