The benchmark Sensex shares ended 0.5 per cent higher on Monday,bolstered by data that showed the economy grew at its fastest rate in six months in the March quarter,with shares in energy major Reliance Industries leading the gains. Still,the key stock market index posted its first monthly decline since January,as investors pared their exposure to risky assets in the wake of Europe's sovereign debt crisis. Reliance rose 1.1 per cent to Rs 1,045.05. A source said that Reliance's billionaire owner Mukesh Ambani was in talks to buy a majority stake in JM Financial Asset Management,which oversees $1.8 billion in assets. The main BSE index closed up 0.48 per cent,or 81.57 points,at 16,944.63,after falling as much as 0.3 per cent and then rising 0.6 per cent during the day. Nineteen of the index's components ended in the positive zone. "The economic data has briefly boosted the sentiment,but the overall mood continues to be uncertain on fears that the global economic recovery process may be delayed due to the problems in Europe," said Arun Kejriwal,a strategist at KRIS. The market strengthened after data showed gross domestic product grew 8.6 per cent in the fourth quarter of fiscal year 2009/10 from a year earlier,broadly in line with a forecast of 8.7 per cent in a Reuters poll. "The market is expected to consolidate at this level before moving up as the corporate earnings season is over and there are no positive triggers in the near-term," Kejriwal said. Worries about debt pressure in Europe resurfaced after Fitch downgraded Spain's credit rating and France said keeping its top credit rating may be a stretch without tough budget cuts. The index fell 3.5 per cent in the month,its first monthly decline since January when it had dropped 6.3 per cent. The BSE Sensex has,however,fared better than its Asian peers such as China's Shanghai Composite Index which declined 10 per cent in May and Japan's Nikkei that lost 11.7 per cent in the month. Analysts said the market trend in the near-term would be influenced by the June-September monsoon,which is vital for farm output,rural incomes and is a key driver of demand for a wide range of manufactured goods. Monsoon rains have already hit the country's southern coast,the chief of the weather office said on Monday. Most automobile stocks rose on hopes of strong sales in May. The companies will report May sales numbers on Tuesday. Utility vehicles and tractor maker Mahindra & Mahindra,which has submitted a letter of intent to make a bid for troubled Korean SUV maker Ssangyong Motor,rose 5 per cent to Rs 572.45. Shares in Maruti Suzuki,India's largest car maker and a unit of Suzuki Motor Corp,closed 1.1 per cent higher at Rs 1,236.95. Oil and Natural Gas Corp rose 3.2 per cent to Rs 1,167.20 after the state-run firm posted a 71 per cent rise in quarterly net profit and said it saw hikes in gas prices having a positive impact in the quarters ahead. In the broader market,1,661 gainers outpaced 1,170 losers on volume of 329 million shares. The broader 50-share NSE index ended 0.39 per cent up at 5,086.30 points.
