Indian shares ended marginally higher after hitting their strongest level since late October.
Marginal growth in manufacturing PMI and weak global cues led to heavy selling in banking, capital goods, auto and metal stocks despite buying in FMCG, TECk, IT and realty stocks.
The 30-share BSE index Sensex ended higher by 45.97 points or 0.17 per cent at 26,713.93, after rising earlier to its strongest since October 30.
Similarly, the 50-share NSE index Nifty ended up 19.85 points or 0.24 per cent at 8,179.95, after earlier climbing as much as 0.68 per cent to its strongest since October 27.
Among BSE sectoral indices, FMCG index gained the most by 1.6 per cent, TECk 1.13 per cent, IT 0.83 per cent and realty 0.37 per cent. On the other hand, banking index was down 1.19 per cent, capital goods 0.61 per cent, auto 0.6 per cent and metal 0.55 per cent.
Top five Sensex gainers were Adani Ports (+4.98%), Asian Paints (+3.54%), Bharti Airtel (+3.17%), ITC (+2.6%) and TCS (+2.2%), while the major losers were State Bank of India (-3.39%), ICICI Bank (-2.08%), BHEL (-2.03%), Tata Motors (-1.96%) and Cipla (-1.49%).
Firms reliant on consumer demand, such as ITC, advanced on data showing the economy grew faster than expected in the previous quarter.
GDP, core sector growth
India’s GDP grew 7.9 per cent in the January-March quarter of 2015-16, taking the overall economic growth to a five-year high of 7.6 per cent for the entire fiscal.
Also, production of eight core sectors jumped 8.5 per cent in April on the back of pick-up in output of refinery products, fertilisers, steel, cement and electricity.
Strong GDP growth
India gathered momentum from January to March to extend its lead as the world's fastest growing large economy, with gross domestic product expanding at a stronger-than-expected rate of 7.9 per cent.
The strong headline number adds to optimism about India's economy, with shares gaining around 4 per cent in May to become Asia's best performer last month on forecasts of an above average monsoon and upbeat earnings from blue chip companies.
Separately, a business survey showed manufacturing activity increased for a fifth consecutive month in May.
“I think the GDP data is basically one driving factor...and apart from GDP data it is the earnings growth and allocation of higher sum of money by global FIIs to local markets...all these three factors are definitely playing a role in bringing the market up now,” said Deven Choksey, managing director at KR Choksey Securities.
“The GDP has started looking up mainly because of revival of the projects that were stalled in the economy earlier.”
Global markets
European shares fell on Wednesday, hit by a drop in commodity stocks and banks, while the travel sector was under pressure after the US issued a travel alert over the possibility of attacks in Europe this summer.
The FTSEurofirst 300 and STOXX Europe 600 both fell 0.4 per cent, extending falls from Tuesday's 0.8 per cent drop.
Asian stocks were on a weak footing on Wednesday as a slip in crude oil prices dampened investors’ appetite for riskier assets, while the recently bullish dollar stalled against the euro and yen following a mixed bag of US economic data.
Japan’s Nikkei lost 0.6 per cent as the yen firmed.