The broader NSE index ended higher on Thursday, having earlier hit a near two-year high, with IT stocks leading the gains on the day of derivatives expiry. Infosys gained 1.66 percent and Tata Consultancy Services rose 2.8 percent, while Bharti Airtel hit its highest in 18 months after the telecom operator said it would buy Norwegian Telenor's India unit.
The NSE index ended up 0.14 percent at 8,939.5, its highest close since Sept 8, 2016. The benchmark BSE index closed 0.1 percent up at 28,892.97.The market will be shut on Friday for a public holiday. Analysts said the momentum could wane and the market may enter a consolidation phase as global factors, including potential US rate hikes, gain prominence.
Some volatility in trading is also likely ahead of the expiry of derivatives contracts later in the day. The Reserve Bank of India is expected to keep rates on hold this year, with minutes of its Feb. 7-8 meeting showing concerns about inflation, and three of the six members of the monetary policy panel voicing the need to shift the policy stance to "neutral" from "accommodative."
"The Indian market has been fairly positive in the last few days. Some consolidation and correction can be seen but the gains have been mostly triggered by stock-specific moves," said Neeraj Dewan, director at Quantum Securities. Shares of Bharti Airtel rose as much as 11.1 percent to their highest since Aug. 13, 2015 after it said it would buy Norwegian Telenor's India unit, in yet another consolidation move driven by upstart rival Jio's disruptive pricing.
Idea Cellular, which is in talks with Vodafone's Indian unit about a merger, also rose as much as 8.35 percent, on hopes of increased consolidation in the sector. Meanwhile, IT stocks recovered, with the Nifty IT Index rising 1.6 percent after having shed 1.55 percent a day earlier.
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