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The Sensex and the Nifty rose a little more than one per cent to a three-week high on Friday as technology stocks advanced after Infosys raised the lower end of its financial year revenue guidance. Property developers gained after the country unveiled new real estate investment trust regulations.
Markets also found support in firming hopes of a US deal to ensure the country does not default on its debt, which lifted world shares for a second day and put the dollar on course for its first weekly rise in five.
India's industrial output data, due later in the day, and inflation data on Monday are keenly awaited to find more bright spots in the economy after September trade data came in better than expected.
Shares also found strength on expectations of dollar inflows from India's inclusion in global bond indexes after Reuters reported India was in discussion to gain entry to benchmark indexes for emerging market debt.
The Sensex rose 1.26 per cent, or 255.59 points to close at 20,528.59 points, while the Nifty ended up 1.25 per cent higher at 6,096.20 points, both marking their highest close since September 19.
Infosys shares rose 4.7 per cent, closing at their highest level since January 12, 2011. Although India's second-largest software services exporter posted a quarterly profit that missed analyst estimates, investors cheered the change to the lower end of its revenue guidance.
