Indian shares stay higher

Indian shares rose for a second straight session on Wednesday as investors returned to buy select stocks after the recent sell-off, with hopes of progress on bailout and austerity steps for debt-laden Greece buoying sentiments globally.
Reliance Communications Ltd led the gains, a day after India's second-largest mobile carrier said it had received several offers for its 95-percent stake in its tower arm, Reliance Infratel, a move seen as aimed at soothing investors after it reported a plunge in profit.
The benchmark 30-share BSE index gained 0.6 percent, or 105.5 points, to close at 18,608.81, with 22 components advancing.
The 50-share NSE index closed 0.6 percent higher at 5,592 points. In the broader market on the NSE, 924 gainers led 475 losers and about 560 million shares changed hands.
The main BSE index had lost 3.3 percent in May as foreign funds pulled out $1.44 billion in the month till May 30, mainly on worries high inflation and rising borrowing costs would crimp growth in Asia's third largest economy.
However, foreign funds have been net investors in the past three sessions.
Even so, the level of activity in the manufacturing sector maintained its strong momentum and the index has now stayed above the 50 that divides growth from contraction for the 26th consecutive month.
"The momentum in the manufacturing sector eased in May as sequential growth in output and orders slowed a bit. However, the momentum remains strong," said Leif Eskesen, chief economist for India & ASEAN at HSBC.
State-run Steel Authority of India Ltd's shares ended 3.1 percent higher after its chairman said it was difficult to launch its up to $778 million share sale in mid-June due to unfavourable market conditions. Maruti Suzuki ended 1.6 percent higher after the country's top car maker said vehicle sales in May rose 1.9 percent despite increase in interest rates.
"Maruti's numbers have lifted sentiment. There was a doubt if auto companies would be able to maintain growth given the rising commodity prices and high interest rates," said Gajendra Nagpal, CEO of Unicon Financial.
"Maruti's numbers are good. The market is reassured."
Utility vehicle leader Mahindra & Mahindra ended 0.6 percent higher after posting a 20 percent rise in May automobile sales.
However, Tata Motors lost 1.4 percent even after the top truck and bus maker reported a 10 percent rise in vehicles sales for May. Morgan Stanley said in a note slowing domestic growth, stubborn inflation, high oil prices and rising rates were hurting shares, but the broader market valuations were looking attractive after the recent sell-off.
The benchmark index should rise to 22,100 by the end of this year, an increase of about 19 percent from the current levels, it said. In the near term, Morgan Stanley expects the benchmark to move in a range of 17,500-21,000.