CORRECTED - BSE Sensex posts gains; earnings in focus

(Deletes reference to second day of gains in headline, lead and

sixth paras)

By Abhishek Vishnoi

MUMBAI (Reuters) - The BSE Sensex rose on Wednesday, as consumer goods shares such as Hindustan Unilever surged to record highs benefitting from their more defensive nature in an uncertain market environment and from confidence about their growth prospects.

The gains in broader indexes came even as the Indian government's measures to relax foreign direct investment failed to shore up much confidence, given doubts about whether long-term inflows would materialise anytime soon.

Traders remain on watch for upcoming blue-chip earnings results and more potential measures from policy-makers to stem the slide in the rupee.

 

Abroad, the focus is on Federal Reserve Chairman Ben Bernanke's testimony to the U.S. Congress later in the day.

"Some more steps to remove administrative and procedural bottlenecks in India are expected in due course of time which may aid foreign flows" said Dipen Shah, head of private client group research, Kotak Securities.

The benchmark BSE Sensex rose 0.49 percent, or 97.50 points, to end at 19,948.73.

The broader Nifty rose 0.3 percent, or 18.05 points, to end at 5,973.30.

Gains were led by consumer goods shares, with the sectoral index closing at its highest ever.

Hindustan Unilver Ltd rose 9.9 percent, after earlier making an all-time high at 699.35 rupees, while ITC Ltd ended 2.3 percent higher after hitting a record high of 370.40 rupees earlier.

United Spirits Ltd gained 0.6 percent after touching an all-time high of 2,739.35 rupees, while Dabur India Ltd rose 4.2 percent after earlier hitting its record-high at 167.90 rupees.

Nestle India Ltd also rose to a record high of 5,787 rupees, before ending 1 percent higher.

Tata Consultancy Services Ltd rose 1.8 percent, rising 11.5 percent in six consecutive sessions of gains ahead of its April-June earnings on Thursday.

Reliance Industries Ltd also rose 1.6 percent, rising for a fifth day ahead of its June quarter earnings on Friday.

However, Reliance may miss operating profit consensus forecast for April-June when it reports results on Friday, according to Thomson Reuters StarMine data.

Among decliners, mobile operators such as Idea Cellular Ltd fell on profit-taking even after India approved raising the foreign investment limit in the sector to 100 percent from the current 74 percent.

Idea ended 4.5 percent lower after earlier making a record high of 163.55 rupees while Reliance Communications Ltd fell 2.1 percent.

Lenders such as Yes Bank Ltd and other financial firms fell for a second day after the Reserve Bank of India raised short-term interest rates to curb the rupee's slide.

Financial companies dependent on short-term wholesale funding will be the most affected by RBI's measures to curb liquidity, analysts said.

Yes Bank fell 5.3 percent after dropping 9.9 percent on Tuesday, while IndusInd Bank Ltd ended 2.7 percent lower.

HDFC Bank fell 2.3 percent after its asset quality, worsened slightly, with net non-performing loans as a percentage of total assets at 0.3 percent compared with 0.2 percent a year earlier.

(Editing by Sunil Nair)