Sensex, Nifty hit record highs

MUMBAI, Oct 30 (Reuters): The BSE Sensex and Nifty rose nearly 1 per cent to a record high on Thursday as investors bet an improving economy and government reforms would allow the country to better withstand potential rate hikes by the US Federal Reserve than other emerging markets.
The Nifty has gained nearly 31 per cent in US dollar terms so far this year to remain Asia's best performing equity index, helped by optimism tied to the election of Narendra Modi as Prime Minister.
The Reserve Bank of India's efforts to contain inflation have also improved confidence. Hopes are now rising that the RBI will be able to ease monetary policy as early as its next meeting in December given a slowdown in consumer price growth.
Thursday's gains contrasted with a 0.5 per cent fall in the MSCI Asia-Pacific index, excluding Japan after the Fed ended its massive bond-buying programme as expected, on Wednesday, but laced its economic assessment with a tinge of hawkishness.
"Fed's decision is almost priced in and now each market is on its own merit. India stands out among emerging markets due to the bold and courageous decisions it has taken so far," said Deven Choksey, managing director at KR Choksey Securities.
The 30-share BSE Sensex rose as much as 1.1 per cent to an all-time high of 27,390.60, while the Nifty gained as much as 1.12 per cent to mark a record high of 8,181.55, with both surpassing their previous highs hit on September 8.
The benchmark BSE Sensex ended up 0.92 per cent at 27,346.33, marking its highest close. The broader Nifty gained 0.97 per cent, rising for eight sessions in nine.
India ended fuel price controls, raised gas prices, proposed opening up of the coal sector and relaxed rules for foreign investment in construction, earlier in October.
Exporters led the gains on the Fed's increased optimism about the US economy, with Infosys Ltd ending up 1.7 per cent, while rival Tata Consultancy Services Ltd gained 2.1 per cent.
Tech Mahindra Ltd rose 3.5 per cent after the company's July-September profit rose 7.3 per cent to 5.89 billion rupees ($96 million).
Among drugmakers, Dr.Reddy's Laboratories rose 1.6 per cent.
Among builders, Unitech rose 8.1 per cent and DLF Ltd gained 5.1 per cent after India relaxed rules for foreign investment in construction.
Indian energy conglomerate Reliance Industries also rose 2.9 per cent.
Among domestic oriented stocks, Larsen and Toubro rose 1.3 per cent, while HDFC Bank gained 0.6 per cent.
ICICI Bank rose 0.5 per cent after posting a record profit in July-September.
Maruti Suzuki India rose 1.1 per cent after the carmaker said its board had decided to recommend an increase in the foreign institutional investor holding limit to 40 per cent.
However, Cipla fell 1 per cent on profit-taking after hitting a record high of 663.80 rupees.