Indian shares rise as PM Modi's cabinet takes shape; oil marketers lead gains

* NSE index up 0.6%, BSE index rise 0.5%

* HPCL shares hit over 13-month high

* Coal India rises on stellar Q4

May 31 (Reuters) - Indian shares rose on Friday boosted by optimism from a newly formed cabinet with investors awaiting portfolio distribution due later in the day, while weak oil prices pushed up oil marketing companies.

Indian Prime Minister Narendra Modi took oath of office on Thursday for his second innings along with his ministers, with several media reports suggesting that his key aide Amit shah is set to be the new finance minister.

Shah, the chief of Hindu nationalist Bharatiya Janata Party (BJP), masterminded the BJP’s landslide victory in the April-May general election. Modi is expected to announce his ministers’ departments on Friday.

Investors are also awaiting key gross domestic product data due later in the day.

The broader NSE index was up 0.56% at 12,012.20 as of 0513 GMT, while the benchmark BSE index rose 0.53% to 40,041.25.

“Market movement is more sentiment driven today. The contemplation around Amit Shah getting finance ministry is boosting market sentiment,” said Siddharth Sedani, equity advisory head at brokerage Anand Rathi.

However, market participants are more concerned towards the continuity of direction of the government and policy, he added.

Oil marketing companies were among the biggest gainers after crude came under pressure on renewed trade conflicts and as U.S. crude output returned to record levels.

Oil prices were on track for their biggest monthly fall since November after U.S. President Donald Trump said he would impose tariffs on imports from Mexico, stoking fears about global economic growth. Crude prices have also been under pressure from a smaller-than expected decline in U.S. stockpiles.

Hindustan Petroleum Corp shares hit their highest since April 2018, rising 4.5%. Bharat Petroleum Corp rose as much 3.5%, touching their highest level since June 2018.

Among the gainers, shares in state-run Coal India Ltd rose as much as 4% to their highest since Nov 2018 after posted a more than four-fold jump in quarterly profit, handily beating market estimates.

Reporting by Krishna V Kurup in Bengaluru; Editing by Rashmi Aich