India stocks advanced, with benchmarks settling at fresh peaks, boosted by signs that the economy is recovering.
On the domestic equity market front, the BSE Sensex ended 403.29 points or 0.87% higher at 46,666.46, while the NSE Nifty rose 114.85 points or 0.85% to 13,682.70. Both measures saw a fourth day of gains. Asian equities gained as US lawmakers moved toward a spending plan that would boost the economy.
A trade report suggests economic activity is getting back on track, Capital Economics (Asia) economists wrote in a note. Foreign investors have poured about $21bn into Indian equities this year, the most since 2012, helping drive key gauges to new highs.
“The key important factor track now is liquidity, and as long as that’s supportive we are likely to see positive sentiment,” said Anita Gandhi, an investment advisor at Arihant Capital Markets Ltd in Mumbai.
India’s trade deficit last month was narrower than economists estimated, a report showed after markets closed yesterday. Earlier this week, a release showed inflation slowed more than expected in November.
The yield on the benchmark 10-year government bond was little changed at 5.89%, while the rupee weakened 0.1% to 73.5875 against the US dollar.
All 19 sector sub-indexes compiled by BSE Ltd rose, led by a gauge of real estate companies
Twenty-one shares on the Sensex index rose while nine fell. Housing Development Finance Corp Ltd contributed most to the index advance and had the steepest rise with a 3.1% jump, ICICI Bank Ltd was the biggest loser and drag on the index, slipping 1.1%.
Meanwhile the rupee appreciated 5 paise to close at 73.58 (provisional) against the US dollar on Wednesday, as sustained foreign fund inflows and strong domestic equities strengthened investor sentiment. 
Traders said the weakness of the American currency in the overseas market also supported the domestic unit. 
At the interbank forex market, the rupee opened at 73.49 against the US dollar and witnessed an intra-day high of 73.48 and a low of 73.60. 
The local unit finally closed at 73.58 against the American currency, registering a gain of 5 paise over its previous close. 
On Tuesday, the rupee had depreciated by 8 paise to 73.63 against the US dollar. 
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.35% lower at 90.15. 
“The currency market is very lacklustre and the focus is on tonight’s Fed policy. The hopes of a dovish Fed have kept dollar bulls on sidelines. 
“In our view, the global optimism over rolling out of coronavirus vaccine and the hopes of another US fiscal stimulus package may push USD/INR spot towards 73.25. Also, RBI is not very aggressive with its intervention. So, consistent trading below 73.25 will push the price towards 73 zone, while 74 will act as a strong resistance,” said Rahul Gupta, head of research – currency, Emkay Global Financial Services. 
Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs2,484.09 crore on a net basis on Tuesday, according to exchange data. 
Brent crude futures, the global oil benchmark, rose 0.26% to $50.89 per barrel.