MUMBAI (NewsRise) -- Indian shares rose to a two-year high on Monday, outperforming regional markets, as Reliance Industries extended gains amid optimism its telecom business would make profits sooner than expected.
Bets that Prime Minister Narendra Modi's Bharatiya Janata Party would emerge victorious in elections in the northern state of Uttar Pradesh further boosted investor sentiment.
The benchmark BSE Sensex gained 0.8%, or 215.74 points, to 29,048.19, its highest level since Mar. 5, 2015, while the broader NSE Nifty 50 index ended 0.7% higher, or 65.90 points, at 8,963.45 points. Reliance Industries, the country's biggest private company by sales, jumped 3.7% to 1,304.90 rupees, a near nine-year high, after several brokerages recently upgraded their price target on the stock, betting that its telecom unit could contribute to profits earlier than expected.
"Expectations of U.P. election results emerging in favour of the BJP, and approval of key bills related to the proposed Goods and Services tax helped markets off to a positive start for the week," said Anand James, Chief Market Strategist at Geojit Financial Services. "Underlying domestic cues would remain in focus in the immediate term."
A panel of federal and state finance officials finalized over the weekend two key bills related to the launch of the much-awaited Goods and Services tax, a uniform nationwide tax. These bills will now go to parliament for approval. The second part of the budget session of the parliament starts later this week.
Election results in Uttar Pradesh, India's most populous state, and other four states are due on Saturday, and a victory by BJP would boost Modi's chances for a second consecutive five-year term in the national elections in 2019.
Twenty three of the 30 Sensex constituents ended higher, while overall on the BSE, advancing issues beat declining ones 1,511 to 1,371 and 213 issues were unchanged.
Among other key movers, Tata Motors gained 2.3% to 470.70 rupees after posting a 16% jump in Jaguar Land Rover sales in U.S. last month.
Cigarette and consumer goods maker ITC advanced for the first time in three sessions, ending up 0.7% at 263.80 rupees.
Information technology companies led losers on Monday amid concerns unfavorable U.S regulation changes around immigrant visas may hurt business prospects.
Media reports said the U.S has suspended premium processing of H1B visas citing application backlog. The move could hurt Indian IT firms that depend on the visas to send across skilled staff from India for U.S. projects.
Tata Consultancy Services fell 0.9% to 2,470.65 rupees and peer Wipro finished 0.1% lower at 491.85 rupees.
Drug maker Cipla rose 0.3% to 589.25 rupees after its unit signed pacts with South Africa's Ascendis Health for selling its animal health business in South Africa and Sub-Saharan Africa.
Coal India rose 0.6% at 323.70 rupees. The state-run company is scheduled to announce an interim dividend later in the day.
Elsewhere in Asia, Japan's Nikkei 225 index ended down 0.5%, while Hong Kong's Hang Seng rose 0.2%. China's Shanghai Composite index gained 0.5% and South Korea's Kospi index added 0.1%.
--Dhanya Ann Thoppil