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Financials buoy Indian shares; Amara Raja Energy powers small-caps

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Updates at 10:10 a.m IST

By Sethuraman N R

BENGALURU, June 25 (Reuters) -Indian shares rose marginally in morning trading on Tuesday, boosted by financial stocks, while the small-cap index jumped on the back of a 17% surge in Amara Raja Energy.

The NSE Nifty 50 index .NSEI was up 0.2% at 23,577 as of 10:10 a.m. IST, trading in the roughly 450-point trading range for an eleventh straight session.

The S&P BSE Sensex .BSESN increased 0.2% to 77,495.

"We have reached a stage where foreign institutions have become net long in the market, especially in large caps. It will be difficult to see them adding more at these levels," said Neeraj Dewan, director at Quantum Securities.

The Nifty hit a record high of 23,667.10 last Friday and has surged nearly 11% from the dip seen on June 4, in a post-election rally.

"We will see more stock-specific moves in the small- and mid-caps, which is what we are seeing. This will keep happening until the quarterly earnings season," Dewan said.

The domestically focussed small-cap index .NIFSMCP100 jumped 1%, led by gains in Amara Raja Energy and Mobility AMAR.NS.

Amara Raja's shares advanced 15% after the battery maker signed a licensing agreement with a unit of China-based Gotion High Tech 002074.SZ to produce lithium-ion batteries in India.

Financial stocks .NIFTYFIN gained 0.6%, while bank stocks .NSEBANK rose 0.5% and were the top sectoral gainers.

These stocks, said analysts, will continue to see buying as they have been laggards this year, with their 8% rise well below the 24-43% jump in metals, autos and realty stocks.

Meanwhile, Bandhan Bank BANH.NS fell 3% after the Reserve Bank of India appointed a director to the lender's board. The move is generally seen as an increase in oversight of a bank's operations.

Happiest Minds Technologies HAPP.NS fell 8% on multiple block deals.

Reporting by Sethuraman NR in Bengaluru; Editing by Savio D'Souza


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