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  • Jan 6th, 2004
  • Comments Off on Indian stock index at new closing high
India's benchmark stock index rose to a new closing high on Monday ahead of the earnings season due to start later this week, but caution had set in after the recent heady gains.

Analysts expect domestic companies to announce good financial performances in the October-December quarter as Asia's third-biggest economy shifts into higher gear.

The 30-share Mumbai stock exchange's Sensex rose 0.21 percent to 6,039 points, taking gains over the past four sessions to a hefty 4.3 percent.

"Nobody is sure of a quick rise in the short-term but investors do not want to get out either since the medium- to long-term trend is positive," said Krishnamurthy Vijayan, chief executive officer of J.M. Capital Management.

Bullish foreign investors invested $6.7 billion in Indian shares in 2003, nine times the total of 2002, and traders expect more foreign investments after the third quarter's stunning 8.4 percent economic growth.

State Bank, the nation's top commercial bank, rose six percent to 601.25 rupees on speculation the government could ease a curb on foreign fund investments in the bank from the current 20 percent of paid-up capital. Government officials were not immediately available for comment.

Infosys Technologies, the nation's No 2 software services exporter, rose 3.9 percent to 5,892.35 rupees on expectations it would report strong earnings for the October-December quarter on Friday.

There was little reaction to the first meeting in over two years between Indian Prime Minister Atal Behari Vajpayee and Pakistan President Pervez Musharraf.

"My long-term call on the market will be not based on the recent initiatives," said Paras Adenwalla, head of equity funds at Birla Sun Life Asset Management.

"Investors would like the improvement in relationship to be long lasting and not merely seasonal," he said.

Copyright Reuters, 2004


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