Indian stock index jumps on stimulus hopes

MUMBAI — India's benchmark stock index jumped 5.5 percent Friday, bolstered by a regional rally and expectations the government will soon take more steps to stimulate the economy.

The Sensex index closed up 464.2 points at 8,915.21, after several days of losses.

Anticipation that the government would take new steps over the weekend or early next week to simulate growth pushed the Sensex up more than 6 percent during the session, said Dipen Shah, vice president for private client group research at Kotak Securities in Mumbai.

"Expectations are running high," he said.

Shah said he expects the Reserve Bank of India to further cut the nation's key interest rate and reduce the amount of money banks must keep in cash and in government securities.

He also said he expects the government to announce measures to bolster infrastructure spending, and perhaps help real estate developers, who have been hard hit by slowing growth.

Real estate was the only losing sector index Friday, closing down 2 percent.

Power, oil and gas, and capital goods stocks led gains. Reliance Infrastructure rose 14.1 percent, copper producer Sterlite Industries gained 9.1 percent, and state power utility NTPC Ltd. gained 8.8 percent.

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