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Last Updated: Thursday, 14 September 2006, 16:25 GMT 17:25 UK
Indian shares climb above 12,000
Indian stockbrokers
Analysts say the market is still volatile
After days of flirting with the 12,000 mark, Indian shares passed through the key psychological barrier on Thursday.

The Mumbai Stock Exchange's benchmark Sensex index topped 12,000 for the first time since May on expectations of strong economic growth this year.

The International Monetary Fund said it expected global expansion of 5.1% in 2006, ahead of previous forecasts.

The Indian economy is expected to expand 8.3% this year, continuing its rapid growth over recent years.

'Good results'

The market slipped slightly before closing up 79.23 points at 11,973.02 points, 0.67% ahead on the day.

It was propelled by strong performances from the software, banking and car sectors.

I think today's rally has been good in boosting retail investor confidence
Krishna Kumar Karwa, Emkay stockbrokers

Shares in ICICI, India's largest private sector bank, climbed 3.13% while shares of software major Infosys rose 1.07%.

Analysts said investors were returning to the market ahead of what is expected to be a strong set of trading figures by top firms next month.

Still volatile

"Investors are expecting good results," said Krishna Kumar Karwa, managing director of Emkay stockbrokers. "I think today's rally has been good in boosting retail investor confidence but they (investors) are still wary."

But Mr Karwa said the market was still extremely volatile, shares having fallen more than 300 points earlier in the week.

"I think the market is rather hollow as of now and the mood is one of caution," he stressed.

Indian shares have been slowly regaining ground lost earlier this year, when fears of rising inflationary pressures in the world's leading economies triggered a period of heavy losses.

The Sensex reached a record high of 12,612 points on 10 May but fell below the 9,000 mark the following month.

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