Hopes of more open market operations and some monetary easing by the Reserve Bank of India by December-end also aided sentiment. "Going ahead, market's movement will depend on the parliament's behaviour. If the government wins the FDI vote, it will be taken positively, but if they lose then selling cannot be ruled out," said R.K. Gupta, managing director at Taurus Mutual Fund.
However, there are apprehensions that while the government will be able to muster support for the bill in the Lok Sabha, it will still remain pending in the Rajya Sabha, Gupta added. The benchmark BSE index gained 0.22 percent, or 42.80 points, to end at 19,348.12. The broader NSE index rose 0.31 percent, or 18.30 points, to end at 5,889.25, finding resistance around psychologically important 5,900 level.
Reliance Industries rose 2.6 percent, marking its highest single day percentage gain since September 17, on a report in the Economic Times newspaper that the oil ministry is poised to approve the company's investment plans for the controversial KG-D6 block, citing government sources. Banking shares also rose on hopes of more central bank action, dealers said.
ICICI Bank ended 1.55 percent higher after earlier hitting a new 52 week high of 1122.60 rupees, while State Bank of India gained 1.6 percent, marking its sixth day of gains. Earlier in the day, the RBI conducted an auction to buy up to 120 billion rupees of debt, including the benchmark 8.15 percent 2022 bond and the 8.19 percent 2020 bond. Shares in Jaiprakash Power Ventures Ltd gained 9.9 percent after its parent company, Jaiprakash Associates Ltd, said the Amelia North coal mine has received the final Stage II forest clearance for diversion of 728.75 hectares of forest land for coal mining.
However, among stocks that fell, Hero MotoCorp Ltd dropped 0.6 percent after Bank of America Merrill Lynch downgraded the stock to 'underperform' from 'buy' and cut its target price to 1,650 rupees from 1,980 rupees. Larsen & Toubro Ltd fell 0.5 percent after Jefferies said the company needs to announce additional projects worth 54 billion rupees this month to meet expected order flow of 180 billion rupees for the third-quarter.
Shares in India's Jet Airways ended 4.6 percent lower on profit-taking, after earlier gaining as much as 7.1 percent intraday, on reports that it may sell a 24 percent stake to Etihad Airways. Retail shares such as Pantaloon Retail India ended marginally lower at 0.2 percent, ahead of the parliament vote.