Techs,banks shove Sensex up 1%

Quarterly earnings in India should also show robust growth as the country’s trillion-dollar economy is widely expected to expand around 8.5 per cent in 2010/11 from 7.4 per cent in the past year.

The 30-share BSE index closed up 1.03 per cent,or 180.70 points,at 17,651.73,with 24 of its components advancing.

Any pick-up in foreign buying,which has slowed to $99 million in the first four sessions of July from $2.1 billion June 1-29,will be a key driver for the index that is down 0.3 per cent so far this month.

“From the long-term perspective,better monsoon and reforms by the government are definitely hinting to growth for Indian stocks,” said Gajendra Nagpal,CEO of Unicon Financial.

“But from a short-term view,things are uncertain. It all depends on global cues.”

Annual monsoon rains have covered the entire country,the weather office said this week,raising the outlook for farm output and rural incomes,both vital to push economic growth in India that lacks proper irrigation.

Food prices eased in late June but fuel inflation accelerated keeping the case for the central bank to maintain a hawkish stance at its policy meet on July 27.

However,investors shrugged off hardening interest rates and bought banks betting on their long-term outlook.

Top lender State Bank of India rose 2.3 per cent while rivals ICICI Bank and HDFC Bank gained 1.9 per cent and 0.3 per cent respectively.

Infosys,which releases quarterly result on Tuesday,climbed 1.6 per cent on improving outlook hopes.

“The results are likely to be good. Rupee was also fairly benign in the quarter,” Nagpal said.

Rivals Tata Consultancy Services and Wipro were up 1.7 per cent and 0.6 per cent respectively.

Advancing shares outnumbered declining ones in the ratio of 1.5:1 in the broader market on relatively better volume of 432 million shares.

The 50-share NSE index rose 1.1 per cent to 5,296.85.

Brokerage Prabhudas Lilladher expects quarterly revenue and profit after tax of the companies in the broader index to grow by 30.4 per cent and 37.2 per cent respectively.

“However,since the recovery in earnings really started from Q2FY10,we fear that the current quarterly growth is a near-term peak as the base effect starts wearing off,” it said in a note.

Metal producers rallied as LME and Shanghai base metals gained cheering the rally in global equities.

Non-ferrous metals maker Sterlite Industries firmed 3.6 per cent,while aluminium producer Hindalco rose 2.1 per cent.

Tata Steel,the world’s eighth-largest producer of the alloy,gained nearly 2 per cent.

Auto firms rose after an industry body forecast a 12-13 per cent rise in car sales for 2010/11 after posting a near 31 per cent rise in sales in June..

Leading car maker Maruti Suzuki climbed 1.5 per cent,truck,bus and car maker Tata Motors rose 0.7 per cent and utility vehicles and tractor maker Mahindra & Mahindra gained 0.3 per cent.

Bharti Airtel gained 1.7 per cent after the top mobile operator said late on Wednesday it would invest $600 million in Nigeria over the next three years,half within the next 12 months.

The MSCI world equity index was up 0.6 per cent by 1029 GMT.

The Thomson Reuters global stock index rose 0.7 per cent.