* NSE index up 0.5 pct, BSE index up 0.6 pct
* Tata Motors top pct loser on both indexes
By Krishna V Kurup
May 24 (Reuters) - Indian shares rose on Thursday, driven by IT stocks such as Infosys Ltd and Tata Consultancy Services Ltd on the back of a weak rupee.
The rupee has weakened by more than 7 percent so far this year, hitting its lowest since December 2016 at 68.46 per dollar on Wednesday, as surging crude oil prices weigh on India, the world’s third largest importer of the commodity, raising fears that soaring costs could drive up inflation and widen the trade deficit.
Bearish bets on the rupee climbed to their highest since August, a Reuters poll showed last week, with sentiment further soured by rising oil prices.
A weaker rupee could translate into higher returns from the U.S. market, the biggest source of revenue for IT companies.
With the market factoring in that the rupee will stay at current levels going forward, this will be an advantage for IT companies, said Sudheer Guntupalli, a technology sector analyst with Ambit Capital.
“Market is also expecting an uptick in IT spending in key client verticals such as BFSI (Banking, Financial services and Insurance), retail, etc after the recent U.S. tax reform,” said Guntupalli.
The Nifty IT index rose as much as 2 percent, its biggest intraday gain in nearly four weeks, and has gained 15.4 percent so far this year.
Infosys rose as much as 3 percent and TCS climbed 2.8 percent.
The broader NSE index was up 0.48 percent at 10,480.20 as of 0716 GMT, while the benchmark BSE index was 0.62 percent higher at 34,557.42.
Meanwhile, Tata Motors Ltd fell to its lowest since February 2016 after the automaker said fourth-quarter profit halved due to higher expenses and a one-off charge. Tata Motors was the top percentage loser on both the indexes.
Jet Airways (India) Ltd, the country’s second-largest airline by market share, hit its lowest since February 2017 on bleak quarterly results. (Reporting by Krishna V Kurup in Bengaluru; Editing by Subhranshu Sahu)