The bomb attacks hit rush-hour commuters

There had been fears of a major share sell-off after the explosions that hit rush-hour commuter trains in India's financial capital killed 183 people.

But the Sensex index of leading shares ended the day nearly 3% higher.

Investor confidence was boosted by news of a big rise in profits for Indian computer giant Infosys.

Markets were also supported by the latest industrial production figures, which show that output in May rose by 10% year-on-year, stronger than expected.

Previous bombings

India's central bank promised to keep a close eye on financial markets, while the country's finance minister Palaniappan Chidambaram said the bombings would not hinder economic growth.

"This is not the first time bomb blasts have taken place in Mumbai and I think people have got used to it," said Hemen Kapadia, an analyst at investment firm Morpheus Incorporated.

"The psyche of people has been battered as hundreds of lives have been lost but there was no damage to business establishments or property.

"I don't think the blasts will affect the markets because if it had to, then it would have done so within minutes of the market opening today but that didn't happen."

After the city was hit by a series of 13 blasts in 1993, including one on the stock exchange itself, the Sensex index rose by more than 2.5%.