MUMBAI, Aug 22 (Reuters): India's NSE index rose on Friday to a record high for the fourth time this week as software stocks gained after upbeat US and German data raised optimism about the sector's business outlook, while higher global shares also helped. US data, including a jump in existing home sales and a drop in initial jobless claims helped push the S&P 500 to a record high on Thursday.
European shares also gained in the previous session after better-than-expected German private sector growth figures. India's 50-share NSE index rose as much as 0.48 per cent to record at 7,929.05, surpassing its previous all-time high hit on Wednesday.
The shares marked their eighth day of gains in nine sessions, and a second consecutive weekly advance, as overseas investors' buying spree continued. Foreigners net bought 4.13 billion rupees ($68 million) of shares on Thursday and net debt worth $2.65 billion on Wednesday.
"Reduced geopolitical tensions and optimism on future economic growth buoyed sentiment. Going ahead, expectations on interest rate movements in the US and fiscal reforms in India will drive the markets," said Dipen Shah, head of private client group research at Kotak Securities.
Foreign portfolio investors have bought $12.2 billion in Indian equities and $16.47 billion in debt this year on hopes Prime Minister Narendra Modi and central bank Governor Raghuram Rajan will be able to anchor Asia's third-largest economy towards sustainable growth and lower deficit.
The benchmark BSE index rose 0.23 per cent, or 59.44 points, to end at 26,419.55. It added 1.21 per cent over last week for a second straight weekly gain. The broader NSE index closed up 0.28 per cent, or 22.10 points, at 7,913.20, for a weekly gain of 1.56 per cent.
The positive economic data from the United States and Germany boosted stocks of software exporters such as Infosys Ltd , which rose 1.5 per cent, while Tata Consultancy Services ended higher 1.3 per cent and HCL Technologies advanced 2.5 per cent. Tech Mahindra rose 3.1 per cent.
Bank stocks also gained after the Reserve Bank of India said it would conduct more frequent term repos but retained the overall borrowing limit for lenders in a bid to make borrowing more flexible without injecting additional liquidity into markets. HDFC Bank ended higher 1.7 per cent, State Bank of India rose 2.3 per cent, while Bank of Baroda gained 2.1 per cent.
Sugar refiners gained after the government raised the import duty to 25 per cent from 15 per cent. Bajaj Hindusthan Ltd gained 5.1 per cent, Shree Renuka Sugars Ltd ended up 4.7 per cent, and Balrampur Chini Mills Ltd rose 1.5 per cent. Arvind Ltd rose 1.2 per cent after Gap Inc said it planned to extend international presence to India through a franchise agreement with a unit of the Indian company.
