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5 years ago
CORRECTED-Indian shares rise to 5-mth closing high; Infosys gains
August 21, 2012 / 11:48 AM / 5 years ago

CORRECTED-Indian shares rise to 5-mth closing high; Infosys gains

(Corrects BSE closing level in 6th paragraph to 17,885.26
points from 17,884.10)
    * India's BSE index gains 1.1 pct; NSE index up 1 pct
    * Foreign investors continue to buy domestic stocks
    * Maruti Suzuki gains after re-opening Manesar plant

    By Manoj Dharra
    MUMBAI, Aug 21 (Reuters) - Indian shares rose 1.1 percent on
Tuesday to their highest close in five months led by Infosys
after a U.S. court dismissed a lawsuit from an employee, while
consumer good stocks gained on signs of improving rainfalls late
in the monsoon season.
    Shares also benefited from continued global demand for risk
assets on hopes the European Central Bank will act to lower
Spanish and Italian borrowing costs. The tentative optimism
helped send European indices to 13-month highs, with the U.S.
S&P 500 remaining at near four-year highs.
    The improved global sentiment comes despite caution at home
about whether the government will announce bold fiscal measures
as well as other action to attract foreign investments into
sectors such as aviation and retail.
    Foreign institutional investors (FIIs) were net buyers of
8.98 billion rupees ($161.29 million) in domestic stocks last
week, marking a third consecutive week of purchases, and
bringing their total for the year to about $10.41 billion.
    "Market appears in a bullish trend. Political and economic
scenario at present doesn't permit government of India to take
any bold steps. In spite of that, market is showing signs of
improvement and breached 5,400, which is moving purely on FIIs
inflows." 
    India's BSE index rose 1.1 percent to 17,885.26
points, its highest close since March 14. 
    The 50-share NSE index rose 1.02 percent to end at
5,421.00 points.
    Despite the gains, plenty of other caution remains amid
continued signs of slowing economic growth during a period of
high inflation. 
    Data on Tuesday showed India's annual consumer price
inflation slowed slightly in July to 9.86 percent,
but a drought in parts of the country pushed food prices higher.
 
    Among gainers on Tuesday, Infosys rose 2.5 percent
after a U.S court dismissed harassment charges filed by a U.S.
employee, providing a win for the company in its biggest market.
    
   Television reports cited the chief executive of the software
services exporter saying harassment claims by a second
whistleblower in the United States were also unfounded.
 
    Consumer good and auto shares rose after heavy rains hit
some of the parched parts of the country, easing fears of a
repeat of the widespread drought that gripped three years
ago. 
    Hindustan Unilever rose 2 percent, while Godrej 
Consumer products gained 4.4 percent.
    Tractor maker Mahindra & Mahindra shares rose 2.1
percent, continuing to benefit as well after April-June earnings
earlier this month showed strong demand for its utility
vehicles. 
    Maruti Suzuki, shares gained 0.9 percent after it
reopened its Manesar factory on Tuesday under a heavy police
presence. A deadly riot had shut the plant more than a month ago
and cost the company more than $250 million in lost output.
 
    However, Bharti Airtel shares fell 1.4 percent
after Morgan Stanley downgraded the wireless service provider to
"equal-weight" from "overweight", citing concerns traffic growth
was coming at the expense of profit margins. 
    
       FACTORS TO WATCH                                        
    
* Euro rises on ECB bond-buying speculation               
   
* Euro zone policy hopes, supply worries boost oil         
    
* Optimism on Greece, ECB, lifts shares, euro        
 
* Foreign institutional investor flows          
   
* For closing rates of Indian ADRs                       
       
            
   ASIA-PACIFIC STOCK MARKETS:                                  
Pan-Asia........ Japan.......   S.Korea... 
S.E. Asia.......        Hong Kong...  Taiwan.... 
Australia/NZ....        India.......  China..... 
             
   OTHER MARKETS:                                               
Wall Street ....         Gold ....... Currency.. 
Eurostocks.....         Oil ........  JP bonds... 
ADR Report .....       LME metals. US bonds.. 
Stocks News US.. Stocks News Europe     
         
   DIARIES & DATA:                                              
Indian Data Watch   Asia earnings diary 
U.S. earnings diary     European diary       
Indian diary          Wall Street Week Ahead  
Eurostocks Week Ahead                                   
              
   TOP NEWS:                                                    
For top Asian company news, double click on:          
U.S. company news  European company news     
Forex news        Global Economy news     
Technology news  Telecoms news           
Media news       Banking news              
Politics/General    Asia Macro data       
($1 = 55.6750 Indian rupees)

 (Editing by Rafael Nam)

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