Sensex, Nifty advance; ICICI surges over 4%

ICICI Bank gained 4 per cent at the close as global brokerages remained bullish on the stock. (Pixabay Image)

Market benchmark BSE Sensex on Wednesday closed higher by around 175 points in a volatile session, driven by buying in banking, auto and select IT stocks in the last hour of trade as investors bet on a further rate cut by the RBI.

The 30-share Sensex closed at 40,850.29, up by 174.84 points or 0.43 per cent over the previous close with 20 of its constituents ending in the green.

The broader Nifty rose by 43.10 points or 0.36 per cent to end at 12,037.30 as Tata Motors, ICICI Bank and Yes Bank surged. As many as 34 of NSE stocks rose while 16 scrips declined.

Tata Motors rose the most by 7.1 per cent among Sensex scrips after it announced the launch of a premium hatchback.

ICICI Bank gained 4 per cent at the close as global brokerages remained bullish on the stock.

Yes Bank rose nearly 6 per cent while State Bank of India advanced 1.7 per cent after its board approved the sale of up to 8.25 per cent stake in UTI AMC.

IT stocks gained on signs of recovery in the services sector. Tech Mahindra rose by 1.66 per cent, Infosys by 1.41 per cent, and Infosys by 1.39 per cent.

Vedanta Ltd, Tata Steel, Axis Bank, Sun Pharma, ONGC and Hindustan Unilever were also among major gainers.

"The market remained highly volatile on the back of positive to mixed global and domestic cues. Initially, announcement of the Bharat Bond ETF has put some pressure on the market, but in the second half of the trading session, positive news flow on the trade tariff front from US has helped the market to close in positive territory," Shrikant Chouhan, Senior Vice-President, Equity Technical Research, Kotak Securities said.

The Union Cabinet on Wednesday approved the launch of an exchange-traded fund for bonds. The fund will provide additional money for state-run companies and other government organisations, Finance Minister Nirmala Sitharaman said.

Paras Bothra, President of Equity Research, Ashika Stock Broking, commented that market probably sensing for a more than 25 bps cut in repo rates ahead of the RBI monetary policy announcement on Thursday.

"Besides, consensus feeling is that the economy could have hit its trough and there is recovery ahead," he added.

Among the losers, Reliance Industries dropped 1.67 per cent on profit booking after recent gains. Larsen & Toubro was the biggest loser among Sensex scrips dropping by 2.16 per cent.

Maruti, Asian Paints and Bajaj Auto also declined.

Sectorally, BSE metal index rose the most by 1.66 per cent, followed by the Bankex and IT indices.

"Market turned positive supported by moderate growth in India Service PMI data for November and optimism on RBI monetary policy tomorrow. The early signs of recovery in services sector provided impetus for IT index to outperform," Vinod Nair, Head of Research at Geojit Financial Services stated.

On the other hand, BSE capital goods and energy indices were among the major losers.

The BSE mid-cap index advanced 0.52 per cent while small-cap rose by 0.33 per cent.

Asian markets extended the decline after the US President Donald Trump said that the chances of a trade deal with China by the end of the year were low.

Hong Kong, Tokyo and Sydney declined by more than 1 per cent while Shanghai, Taipei and Bangkok dropped up to 0.2 per cent. Singapore dropped 0.6 per cent, and Seoul fell 0.7 per cent.

"I have no deadline," Trump said. "In some ways, I like the idea of waiting until after the election for the China deal." 

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