MUMBAI (NewsRise) -- Indian shares rose to a more-than-five-month high on Tuesday, recording their fourth consecutive day of gains, as stocks of private lenders jumped amid speculation of a merger between Axis Bank and Kotak Mahindra Bank.
The benchmark BSE Sensex ended up 0.4% at 28,761.59 points, its highest level since Sep. 22, while the broader NSE Nifty 50 index gained 0.3% at 8,907.85 points, a level last seen on Sep. 8. Axis Bank jumped 5% to 504.60 rupees, its biggest increase since Sep. 6, sending a gauge of private sector banks on the NSE higher by 1%.
On Tuesday, CNBC-TV18 television channel reported, citing people it didn't identify, that Kotak Mahindra Bank has approached the government, seeking a merger with the country's third-largest private lender Axis Bank.
Axis Bank chief executive Shikha Sharma denied the news, saying the lender is not open for any merger or acquisition as of now. Sharma said the bank has one of the strongest retail franchises in the country.
"Gains in Axis Bank helped the indices pick up pace during the closing stages. Any coverage only seems to feed into the speculation over the possibility of such a merger being considered," said Akash Jain, vice president of research at Ajcon Global. "Overall, the market looks fairly valued currently."
Nineteen of the 30 Sensex constituents ended higher, while overall on the BSE, advancing issues beat declining ones 1,552to 1,271 and 184 issues were unchanged.
ICICI Bank gained 1% to close at 284.90 rupees. HDFC Bank rose 0.4% to 1,412.30 rupees and smaller rival Kotak Mahindra Bank, a constituent of the Nifty index, ended little changed at 797 rupees.
Energy conglomerate Reliance Industries finished 1.4% higher at 1,088.25 rupees after chairman Mukesh Ambani said its telecom venture has crossed the 100 million customer mark.
Telecom stocks took a beating after Ambani's announcement amid concerns increasing competition in the sector could hurt profits. Bharti Airtel fell 3.4% to 362.95 rupees and Idea Cellular ended down 0.4% at 108.30 rupees.
Tata Group stocks ended mixed after group veteran N. Chandrasekaran took charge as the new chairman of Tata Sons, the holding company of the group.
"We will work together with all the business leaders in the group to drive a lot of discipline on capital allocation and shareholder returns," Chandrasekaran told reporters.
Tata Steel gained 0.8% to 490.60 rupees, Tata Power ended down 1% at 84.10 rupees and Tata Motors rose 0.8% to 458.95 rupees. Tata Consultancy Services fell 1.7% to 2,464.30 rupees after a 4.1% surge in the previous session.
In Asia, Japan's Nikkei 225 index rose 0.7% while Hong Kong's Hang Seng fell 0.8%. China's Shanghai Composite index advanced 0.4% and South Korea's Kospi ended 0.9% higher.
--Dhanya Ann Thoppil