Domestic stock markets extended gains in the last hour of trade on Tuesday, led by gains in private sector banking and financial services shares. The S&P BSE Sensex index jumped 583.07 points – or 1.50 per cent – to touch 39,556.77 at the strongest level of the day, and the broader NSE Nifty 50 benchmark climbed above its important psychological level of 11,650 to as high as 11,658.85, up 155.5 points – or 1.35 per cent – from its previous close. Gains in heavyweights such as HDFC, HDFC Bank, Bajaj Finance, ICICI Bank and Kotak Mahindra Bank pushed the markets higher.
The benchmarks staged a gap-up opening taking cues from a strong closing in the US markets overnight, with the Dow Jones, Nasdaq and S&P 500 indices rising 1.6-2.3 per cent each.
At 2:44 pm, the Sensex climbed 539 points to 39,512 and Nifty 50 index surged 138 points or 1.2 per cent to 11,641.
HDFC, HDFC Bank, Bajaj Finance, ICICI Bank and Kotak Mahindra Bank were the top boosts to the Sensex, together contributing more than 300 points to the gain in the index.
Investor sentiment was boosted by the government’s decision to name nominees to the central bank’s Monetary Policy Committee, which begins a three-day policy review on Wednesday.
Analysts awaited the outcome of the Reserve Bank of India’s delayed monetary policy meeting, due on Friday.
The RBI is widely expected to keep key rates unchanged at the upcoming monetary policy review, as it attempts to manage high retail inflation while keeping its policy stance accommodative.
Nine of 11 sector gauges compiled by the National Stock Exchange traded higher, led by the Nifty Financial Services index, which was up nearly 3 per cent. The Nifty Bank, Auto, Private Bank, Media and Realty indices also rose, 1-2.4 per cent each.
On the other hand, FMCG, metal and energy shares witnessed selling pressure.
Mid- and small-cap shares underperformed their larger peers, with the Nifty Midcap 100 and Nifty Smallcap 100 gauges up 0.4 per cent each.
Tata Motors was the top Nifty gainer, up 8 per cent at Rs 144, after its UK unit, Jaguar Land Rover, reported an improvement in its September quarter retail sales. JLR’s retail sales for the quarter ending Sept. 30 were 113,569 vehicles, up more than 50% from the previous quarter. CLSA maintained its “buy” call on Tata Motors for a target price of Rs 220.
HDFC, IndusInd Bank, Mahindra & Mahindra, Adani Ports, Asia Paints, HDFC Bank, Bajaj Finance, ICICI Bank and Bajaj Finserv rose between 2 per cent and 7 per cent. On the other hand, Britannia Industries, Tata Steel, Coal India, Hindalco, Wipro, Eicher Motors and Nestle India were among the notable losers.
Overall market breadth was positive, as 1,420 shares moved higher on the BSE against 1,153 that declined.