Sensex rises with Asian shares as Brexit concern eases

Stocks rose, helping the benchmark index almost erase its weekly drop, as financial and real estate shares climbed and speculation grew that the UK won't vote to leave the European Union.

The S&P BSE Sensex advanced 0.4 per cent to 26,625.91 at the close in Mumbai, trimming its decline from June 10 to less than 0.1 per cent. Local equities tracked gains in Asia as the killing of a UK lawmaker on Thursday fueled speculation that Britons could be more inclined to vote to stay in the EU in the June 23 referendum. The India NSE Volatility Index, a measure of protection against stock-market swings, fell from a two-month high.

Anxiety stemming from a so-called Brexit curbed demand for riskier assets, wiping more than $2 trillion from the value of global stocks over the past week or so. Campaigning for the referendum was suspended for a second day on Friday after the murder of Labour Party lawmaker Jo Cox.

"The markets will track their global peers until the Brexit event gets out of the way," said Chokkalingam G, managing director at Equinomics Research & Advisory Pvt in Mumbai. "We expect volatility to rise."

The Sensex has surged 16 per cent since hitting a 21-month low in February and is up two per cent in 2016 as forecasts for the strongest monsoon in two decades and India's world-beating economic growth lured $2.8 billion in inflows from foreign funds this year.

Tata Motors, the owner of Jaguar Land Rover, rose 2.2 per cent in a fourth day of gains. Bharti Airtel, India's largest mobile-phone operator, rallied three per cent, the most since June 1.

Coal India, the world's largest miner of the fuel, advanced 1.8 per cent. Tata Consultancy Services, the nation's largest software services exporter that gets a quarter of its revenue from Europe, added 1.7 per cent, the most since June 1.