Indian Stocks Advances to Two-Week High as GDP Outlook Improves

Sept. 6 （Bloomberg） -- India’s benchmark stock index rose to its highest in two weeks after better-than-estimated growth in U.S. employment and manufacturing eased concern the global economy will falter, boosting the outlook for domestic companies.

Hindalco Industries Ltd., the nation’s biggest aluminum producer that gets most of its sales in North America and Europe, climbed after Chairman Kumar Mangalam Birla outlined plans to spend 100 billion rupees （$2.14 million） on projects this year. Infosys Techologies Ltd., a software exporter that gets two thirds of its sales in the U.S., gained 1.6 percent.

The Bombay Stock Exchange’s Sensitive Index, or Sensex, gained 174.65, or 1 percent, to 18,396.08 at 10:32 a.m. in Mumbai, set for its highest close since Aug. 23. The S&P CNX Nifty Index on the National Stock Exchange rose 0.9 percent to 5,527.40. The BSE 200 Index advanced 0.9 percent to 2,366.89.

“Any improved data overseas will improve risk taking and encourage the flow of money toward equities,” said Avinash Gupta, an analyst at Bonanza Portfolio Ltd., a New Delhi-based brokerage. “I prefer companies with exposure in overseas markets.”

Hindalco, which gets 76 percent of its sales abroad, added 3.6 percent to 176.5 rupees, on course for its highest close since Aug. 20. The company’s ventures in India’s Jharkhand and Orissa states are on schedule, Birla said at the company’s annual general meeting on Sept. 3, when he also outlined capital expenditure in the year through March.

Infosys

Infosys gained 1.6 percent to 2,822.5 rupees. Tata Consultancy Services Ltd., India’s largest software-services exporter, increased 1.2 percent to 847.5 rupees.

Companies in the U.S. added more jobs than forecast in August and the Institute for Supply Management’s factory index unexpectedly increased, the Sept. 3 reports showed.

Overseas funds bought a net 1.48 billion rupees （$31.6 million） of Indian equities on Sept. 2, raising total investments in the stocks this year to 606 billion rupees, according to the nation’s market regulator.

Inflows from overseas reached a record 834.2 billion rupees in 2009, exceeding the high set two years ago in local currency terms, as the biggest advance in 18 years lured foreign funds. They sold a record 529.9 billion rupees of shares in 2008, triggering a record annual decline.