Indian shares rise with buying in metals, banking as credit worries ease

Indian shares jumped over 2.5 pct in early trade, boosted by buying in banking and metals, with sentiment buoyed by advances in other Asian markets. At 0503 GMT, the Bombay Stock Exchange's benchmark Sensex was up 1.87 pct, or 266.48 points, at 14,515.14, while the National Stock Exchange's S&P CNX Nifty rose 1.74 pct to 4,225.45 points. All BSE 30 shares posted decent gains. In the broader market, 1,495 shares gained, 408 lost and 34 were unchanged. Asian markets are rising as credit worries ease, helped by news about Bank of America's 2 bln usd investment in top mortgage-lender Countrywide Financial Corp. Hopes also exist of a rate cut in the US. In early trade, India's ICICI Bank was up 1.34 pct to 858.10 rupees, State Bank of India rose 2.10 pct to 1,488.50 rupees, while HDFC Bank gained 1.18 pct to 1,132.50 rupees. Copper and aluminium producer Hindalco Industries Ltd rose 2.45 pct to 142.40 rupees. The information technology sector got a boost on hopes corporate spending will increase if the US central bank cuts rates. Most of India's IT majors draw a large part of their revenues from the US. Infosys Technologies Ltd rose 1.42 pct to 1,815.05 rupees, Wipro Ltd jumped 0.83 pct to 457.30 rupees and Tata Consultancy Services Ltd gained 0.74 pct to 1,032 rupees. Ambuja Cements Ltd was up 3.87 pct to 135.55 rupees after Swiss cement giant Holcim made a 154-rupees-per-share open offer to buy an additional 20 pct stake from the public. Diversified company ITC Ltd rose 3.14 pct to 162.25 rupees after the company said yesterday it will set up new small format stores in rural areas on the lines of its existing hypermarket chain, Choupal Sagar, by early next year. Ranbaxy Laboratories Ltd rose 1.66 pct to 360.30 rupees. The company said it had launched a combination drug for a chronic urological disorder in India. Sona Koyo Steerings Systems Ltd rose 2.58 pct to 45.65 rupees as the company announced yesterday it is setting up a company for manufacturing column-type electric power steering, in technical and financial collaboration with Japan's JTEKT Corp. An application seeking approval for the proposed joint venture has been made to India's Foreign Investment Promotion Board, the company said in its statement issued to the BSE.