India Stocks Reach for New Highs on Signs of Economic Revival

(Bloomberg) -- India stocks advanced, with benchmarks headed for fresh peaks, on another sign that the economy is recovering.

The S&P BSE Sensex climbed 0.7% to 46,577.84 as of 9:36 a.m. in Mumbai, while the NSE Nifty 50 Index rose by the same magnitude. Both measures are headed for a fourth day of gains. Asian equities gained as U.S. lawmakers moved toward a spending plan that would boost the economy.

A trade report yesterday suggests economic activity is getting back on track, Capital Economics (Asia) Pte. economists wrote in a note. Foreign investors have poured about $21 billion into Indian equities this year, the most since 2012, helping drive key gauges to new highs.

“The key important factor track now is liquidity, and as long as that’s supportive we are likely to see positive sentiment,” said Anita Gandhi, an investment advisor at Arihant Capital Markets Ltd. in Mumbai.

India’s trade deficit last month was narrower than economists estimated, a report showed after markets closed yesterday. Earlier this week, a release showed inflation slowed more than expected in November.

The yield on the benchmark 10-year government bond was little changed at 5.89%, while the rupee strengthened 0.2% to 73.5225 against the U.S. dollar

The Numbers

• All except one of 19 sector sub-indexes compiled by BSE Ltd. rose, led by a gauge of metal companies
• Twenty-seven shares on the Sensex index rose while three fell
  • HDFC Bank Ltd. contributed most to the index advance and jumped 1.4%, Mahindra & Mahindra Ltd. was the biggest winner with a 2.8% gain

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