India shares record-high rally chugs on; set for best month in 2024

By Bharath Rajeswaran and Hritam Mukherjee

BENGALURU (Reuters) -India's benchmark stock indexes scaled new peaks on Thursday and were on track for the best monthly gain this year, helped by a strong economy, policy continuity and the return of foreign investors.

The NSE Nifty 50 rose 0.74% to end at 24,044.5 points, topping 24,000 for the first time. The S&P BSE Sensex added 0.72% to close above 79,000 points for the first time.

The indexes have closed at record highs for three straight sessions. The Nifty and Sensex have gained 6.72% and 7.14%, respectively, so far in June, set for their best one-month gain since December 2023.

Equity benchmarks corrected sharply at the start of the month after Prime Minister Narendra Modi's party came back to power with a narrower-than-expected margin. But since then, its cabinet assignments have signalled political continuity.

That not only led to a relief rally but also pulled back foreign portfolio investors to the market. Their purchases of shares worth 172.93 billion rupees so far in June is already a three-month high.

"No surprises to guess that the recent move has been supported by the private banking sector, which is a usual favourite among foreign investors," said Jaykrishna Gandhi, head of business development at institutional equities at Emkay Global Financial Services.

Private banks have jumped 9% in June, outperforming the Nifty's 6.7% increase.

ICICI Bank gained 0.16% on the day, rising 10.3% in eight straight sessions in its longest such rally since January 2015. The bank, India's No.2 private lender, crossed $100 billion in market capitalisation earlier in the week.

Reliance Industries, the second-heaviest Nifty stock, was up 1.09%, after gaining 4% in the previous session.

India's top cement maker Ultratech Cement jumped 5.15% after its 18.85 billion rupees ($226 million) deal to buy a 23% stake in India Cements , which surged about 12%.

IT stocks jumped 2.03%, with all ten constituents logging gains. ($1 = 83.5050 Indian rupees)

(Reporting by Hritam Mukherjee and Bharath Rajeswaran in Bengaluru; Editing by Sonia Cheema, Mrigank Dhaniwala and Savio D'Souza)