India’s Bombay Stock Exchange touched a record high Thursday. Meanwhile, exchange traded funds that track India’s small-caps and infrastructure stocks led the charge.

The EGShares India Infrastructure Index Fund (NYSEArca: INXX) was up 3.0% and the iShares MSCI India Small Cap Index (NYSEArca: SMIN) gained 3.2% Thursday on volume that is nearly 75% above average. Over the past month, INXX has increased 6.1% and SMIN rose 9.3%.

The benchmark BSE Index hit a record high of 21,525.14 while the broader NSE Index ended 0.2% off its record high of 6,415.25, reports Abhishek Vishnoi for Reuters.

Foreign investors, who previously fled the country on the heels of Fed tapering, are coming back due to the country’s narrowing current-account deficit to 0.9% of GDP and more staple rupee currency, which has appreciated 12.2% since a record low late August.  [ETF Chart of the Day: Investigating India]

“It’s a little more than what we had really expected. Pre-election run up is helping but some short term correction is possible,” Paras Adenwala, managing director at Capital Portfolio Advisors, said in the article.

India is home to the top-performing BRIC equity market this year. Additionally, the country is the only market after Indonesia to turn positive this year, among the so-called fragile five economies that were vulnerable to foreign investment outflows due to their large current account deficits. [India ETFs: BRIC’s Shining Stars]

The EGShares India Infrastructure ETF tracks leading infrastructure stocks in India, such as Reliance Infrastructure, which ended 9.9% higher Thursday.

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