Indian stock brokers watch the key Sensex share index graph in a brokerage firm in Mumbai May 13, 2004.
Representational Image: Indian stock brokers watch the key Sensex share index graph in a brokerage firm in Mumbai May 13, 2004.Reuters/Punit Paranjpe/Files

Indian stock markets ended with gains for the second straight session on Friday, helped by gains in capital goods, banking and energy sector shares.

The benchmark BSE Sensex advanced 1.12 percent or 204.96 points to 18,517.90. The 50 share NSE Nifty gained 1.11 percent or 60.25 points to 5,468.70.

Markets opened on a subdued note, tracking mixed cues from Asian peers. However, markets pared earlier losses and entered into positive territory by late morning trade on fresh buying in consumer durables, capital goods and auto sector shares.

Meanwhile, HSBC downgraded its rating on Indian stocks to a "neutral" rating from "overweight", citing slowing economic growth and a sharp rise in cost of equity for companies.

The Indian rupee advanced 0.36 percent to 64.32 against the US dollar in late afternoon trade. It hit a new historic low of 65.56 on Thursday but later recovered to end at 64.55.

“The biggest respite today is that the rupee hasn’t weakened,” Gajendra Nagpal, chief executive officer at New Delhi-based Unicon Financial Intermediaries Ltd. Told Bloomberg by phone.

All the 13 BSE sectoral indices ended on a positive note except for the realty sector. Capital goods sector surged 1.87 percent and banking sector gained 1.76 percent, while oil & gas sector rose 1.54 percent and realty sector declined 1.19 percent.

In the Midcap space, PC Jeweller climbed 19.96 percent and JK Cement jumped 6.95 percent, while Berger Paints gained 4.96 percent.

The overall market breadth is positive with 1346 advances against 972 declines on the BSE.

Meanwhile, Asian stock markets end mixed despite encouraging global manufacturing surveys, which showed an across-the-board improvement in manufacturing business conditions in August.

Japan's benchmark Nikkei 225 surged 2.21 percent and South Korea's KOSPI gained 1.14 percent, while China's Shanghai Composite declined 0.47 percent and Hong Kong's Hang Seng fell 0.15 percent.