Indian stocks advance for the third consecutive week amid signs the US economy is improving and as Germany signalled its support for a European Central Bank plan to resolve the crisis.
The BSE India Sensitive Index, or Sensex, increased 0.1 per cent to 17,681.61, according to preliminary closing prices in Mumbai, taking this week’s rally to 0.7 per cent. The market is closed on August 20 for Eid Al Fitr. Tata Motors Ltd climbed for a third day after Jaguar Land Rover sales surged 41 per cent. Hindustan Unilever Ltd, the biggest home-products maker, rallied to a record.
Applications for construction permits in the US rose to the highest since August 2008, a month before the bankruptcy of Lehman Brothers Holdings Inc., signalling stabilization in the housing market that triggered the crisis. German Chancellor Angela Merkel said the ECB’s insistence on conditionality in return for helping cut interest rates for indebted governments matches her priorities.
The Sensex has risen 15 per cent this year, helped by record overseas investor purchases. Foreign funds bought a net $50 million of stocks on Aug. 14, taking their investments in local equities this year to $11.4 billion, data from the market regulator show. That’s an all-time high for the period and the most this year among 10 Asian markets tracked by Bloomberg.