Indian Shares Climb to 1-Month High as Software Exporters Rally

Indian stocks climbed, sending the benchmark index to a one-month high, as a rally in software makers offset a report showing faster-than-estimated inflation.

Tata Consultancy Services Ltd., the country’s top software exporter, rose to a record, helping a measure of 10 technology stocks advance for the fourth day. Hero MotoCorp Ltd. closed at a one-month high. Aluminum maker Hindalco Industries Ltd. had its biggest three-day loss since July 30.

The S&P BSE Sensex added 0.4 percent to 20,607.54 at the close and a gauge of 223 mid-cap companies rose to its highest level since July 23. The Sensex rallied 3.1 percent last week, led by software exporters, after Infosys Ltd. raised its annual sales forecast. Wholesale prices rose 6.46 percent in September from a year earlier, compared with a 6.1 percent climb in the previous month, data showed. That exceeded the 6 percent median estimate of 33 economists in a Bloomberg survey.

“Inflation has probably peaked and price pressures will ease as good monsoon brings down food prices,” Deven Choksey, managing director at K.R. Choksey Shares & Securities Pvt. in Mumbai, said by phone today. “We don’t expect an increase in interest rates from the Reserve Bank in the near term.”

Reserve Bank of India Governor Raghuram Rajan raised the main repurchase rate for the first time since 2011 last month, while data issued Oct. 11 showed factory output growth slowed more than forecast. Rajan also rolled back liquidity-tightening measures aimed at boosting the rupee after the currency jumped 13 percent from a record low on Aug. 28. Data due later today may show consumer prices rose 9.5 percent last month, after a 9.52 percent climb in August, a separate Bloomberg survey shows.

The rupee weakened 0.8 percent to 61.5450 per dollar at the close, the most in three weeks.

Europe Demand

Tata Consultancy advanced 4.3 percent, taking this year’s gain to 76 percent, the best performance on the Sensex. Infosys climbed to its highest close since January 2011. The nation’s second-largest software exporter raised its sales forecast Oct. 10 amid rising demand from clients in Europe and the U.S. The two markets account for 85 percent of Infosys’ revenue. Wipro Ltd., the third largest, jumped 2.6 percent to a 13-year high.

“Infosys earnings have shown that the software sector will benefit from stronger growth in the developed economies,” D.K. Aggarwal, chairman of SMC Investments & Advisors Ltd., said by phone from New Delhi. “Industrial output and other indicators will improve as steps taken by the authorities to support the rupee and kickstart growth would take hold.”

Hero MotoCorp added 0.9 percent to last week’s 2.2 percent jump. Hindalco fell, taking the third-day loss to 7.5 percent. The S&P BSE India Metal Index slid 0.6 percent.

Reliance Earnings

Reliance Industries Ltd., owner of the world’s largest refining complex, may today say its second-quarter profit rose to 54.2 billion rupees from 53.8 billion rupees a year earlier, according to the median of 22 analysts estimates in a Bloomberg survey. The stock climbed 0.8 percent.

The Sensex has risen 6.1 percent this year and is valued at 14.1 times estimated 12-month profits, compared with 10.7 times for the MSCI Emerging Markets Index.

Global investors bought a net $123 million of local stocks on Oct. 10, data from the regulator show. They have purchased a net $14 billion of local equities this year, the second-highest among 10 Asian markets tracked by Bloomberg, after Japan.

The CNX Nifty Index increased 0.3 percent to 6,112.70. The India VIX, which gauges the cost of protection against losses in the Nifty, fell 3.1 percent.

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