Indian shares snap three-day fall

Indian shares nudged higher for the first time in four sessions on Tuesday, largely helped by gains in beaten-down energy giant Reliance Industries and export-driven software firms following firmer world markets. Investors were unconvinced the market could sustain the rise, given stubbornly high inflation, rising interest rates and slowing growth, traders said.
The 30-share BSE index closed up 0.31 percent or 53.67 points at 17,560.30 points, paring gains of more than 1 percent at one stage. Half of its components rose. "There is no incremental buying happening. People are either selling or churning their portfolio," said Sandeep Singal, co-head of institutional equities at Emkay Global Financial Services.
The benchmark index had dropped more than 2 percent on Monday to its lowest close in four months, extending last week's 2.2 percent slide, on investor jitters India may slap taxes on investments from companies or funds registered in Mauritius, a popular route for portfolio inflows. Finance Minister Pranab Mukherjee said on Tuesday the country has resumed talks with Mauritius on reviewing a double taxation avoidance agreement.
Foreign funds have dumped around $410 million of shares in six sessions to June 17, as the near-term market prospects looked bleak. Software services companies that get most of their revenue from exports gained, with Tata Consultancy Services rising 3.5 percent issued a rebuttal to a CLSA downgrade.
Rival Infosys Technologies firmed 0.7 percent. Reliance Industries, which has the highest weight on the main index, climbed 1.9 percent on bargain hunting. It is still down nearly 20 percent in the year to date. Telecom network services provider GTL shed 3.6 percent. Billionaire Anil Ambani-controlled utility Reliance Infrastructure fell for a second day, losing 2.5 percent, as investors reacted to a decision to drop the stock from the nation's benchmark stock index. Losers outpaced gainers in the ratio of 1.6:1, on volume of 575 million shares on the NSE, lower than the 90-day daily average volume of 600 million shares. The 50-share NSE index gained 0.3 percent to 5,275.85.