BSE Sensex rallies; Reliance Industries, banks lead

MUMBAI (Reuters) - The BSE Sensex rose over 1 percent to its highest close since July 11 as improved U.S jobs data sparked a global risk rally, while private lenders such as HDFC Bank surged on hopes for government measures to help the mutual fund sector.

Reliance Industries surged 5.9 percent after the Economic Times newspaper reported the energy conglomerate has agreed to share its accounts for its KG-D6 block with the government, raising hopes for an end to the stand-off between the two sides over the natural gas fields.

Private banks such as ICICI Bank and HDFC Bank held their earlier gains after Finance Minister Palaniappan Chidambaram said the government would unveil policies to attract investments in mutual funds.

The 30-share BSE index provisionally rose 1.25 percent to 17,412.96 points.

The 50-share NSE index provisionally rose 1.28 percent to end at 5,282.55 points.

(Reporting by Manoj Dharra; Editing by Rafael Nam)