Why market rose today?

Indian Stocks Rise to Seven-Month High as Foreign Buying Gains

May 12 (Bloomberg) -- Indian stocks rose to a seven-month high, led by
Reliance Industries Ltd. and Infosys Technologies Ltd., after net
foreign inflow into the country's equities surged last week.

Reliance Industries, the nation's biggest company by market value,
jumped 5.3 percent to the highest in almost eight months. Infosys, the
country's second-largest computer-services provider, climbed 5.3
percent. ICICI Bank Ltd. gained 6.6 percent, leading financial stocks
higher after the central bank said Indian lenders have negligible
amount of toxic assets.

"There is liquidity in the market, which is moving the stocks up,"
said R.K. Gupta, who helps manage the equivalent of $41 million in
equities at Taurus Asset Management Ltd. in New Delhi. "People have
postponed selling anticipating gains."

The Bombay Stock Exchange's Sensitive Index, or Sensex, rose 475.04,
or 4.1 percent, to 12,158.03 at the close, the highest since Oct. 3.
The gain was the first in three days, snapping a two-day, 3.6 percent
decline.

The S&P CNX Nifty Index on the National Stock Exchange added 3.6
percent to 3,681.10. The BSE 200 Index gained 3.4 percent to 1,427.90.
SGX Nifty futures for May delivery advanced 3.9 percent to 3,689.95

Reliance Industries soared 5.3 percent to 1,959.9 rupees. Infosys rose
5.3 percent to 1.598.45 rupees. The two stocks made up 35 percent of
the Sensex's gain.

Election Speculation

Stocks also gained on speculation the opposition Bharatiya Janata
Party and its allies, called the National Democratic Alliance, may win
the national elections, said Jayesh Shroff, who helps manage $5.5
billion in assets at SBI Asset Management Co. in Mumbai. The results
will be released on May 16.

"There are rumors in the market of the National Democratic Alliance
coming to power," Shroff said.

The Bharatiya Janata Party, also known as the BJP, will cut spending
and increase tax collection if it returns to power to plug a revenue
shortfall that imperils growth, Yashwant Sinha, India's former
finance minister and a party lawmaker, said in an interview yesterday.
He expects BJP to emerge as the largest party from the general
election and its strength will act as a "magnet" for new allies,
enabling it to form a government.

Overseas investors bought a net 12.4 billion rupees ($251.9 million)
of Indian stocks on May 8, increasing their total equity purchases
this year to $1.03 billion, according to the nation's market
regulator yesterday.

ICICI Bank jumped 6.6 percent to 558.1 rupee and HDFC Bank Ltd.,
country's third-largest lender, gained 4.2 percent to 1,195.3 rupees.

The country's banks, whose bad loans are low, are not facing any
problems as of now, central bank deputy governor Rakesh Mohan said in
Mumbai yesterday. The country's financial sector reforms have been
constant and gradual, he said.

JSW Steel Ltd. lost 1.6 percent to 417.7 rupees. India's third-
biggest producer plans to sell its U.S. unit at a discount as the
global recession saps demand, the Economic Times said, citing an
unidentified company official. JSW denied it plans to sell its U.S.
unit, according to an e-mailed statement.