Sensex up 412pts at over 3-wk high on RBI steps, reform hopes

Sensex up 412pts at over 3-wk high on RBI steps, reform hopes

Sensex up 412pts at over 3-wk high on RBI steps, reform hopes

The S&P BSE benchmark Sensex today jumped by 412 points to end at over 3-week high of 18,979.76 on the back of a slew of steps announced by new RBI Governor Raghuram Rajan to boost the currency and the overall economy.

Investors became richer by a whopping Rs 1.2 lakh crore today as banks, realty, consumer durables and PSUs rallied. Across BSE, nearly 1,500 stocks rose out of the 2,474 traded.

After gaining 333 points in the previous session, Sensex surged by 412.21 points, or 2.22 per cent to 18,979.76. Intra-day, it breached 19,000 level to hit 19,117.52.

Markets lapped up Rajan's positive announcements after he took charge at RBI with experts viewing his move to allow banks to swap their USD liabilities against FCNR(B) (foreign currency non-resident) as a key step. A meaningful improvement in rupee would raise the likelihood of a rollback of some of the RBI's recent liquidity-tightening measures, brokers added.

"Smart recovery of rupee which was trading near 66 level, recovery in bonds and positive global cues, all lifted market sentiment. Buying was prominent in rate-sensitive sectors. IT, however, was down as rupee recovered," said Rakesh Goyal, Senior Vice President, Bonanza Portfolio.

The rupee, which had closed at 67.07 yesterday, sprung to 65.5 levels intra-day and was last trading at 66.2 levels.

The National Stock Exchange index Nifty shot up 144.85 points, or 2.66 per cent to 5,592.95, after touching a high of 5,625.75. MCX-SX's SX-40 ended at 11208.21, up 241.39 points.

The passage of Pension Bill in Lok Sabha yesterday raised hopes of more such reforms soon, experts added.

The banking sector index gained the most by rising 9.30 per cent to 11,014.99 as Yes Bank, Axis Bank, HDFC Bank, SBI, ICICI Bank and Bank of Baroda shares in 7-21 per cent range. Gains were cemented by rate cut hopes in the next policy meet.

The interest-linked realty sector was second best performer by adding 5.41 per cent to 1,213.29 while consumer durable sector jumped by 4.54 per cent to 6,751.63.