Boosted by fresh buying in beaten down sectors towards session end, both Sensex and Nifty logged their best gains in almost two weeks. led by heavy buying in bluechips, Sensex surged to 330.71 points and ended the session at 25,521.19. Rupee also appreciated for the first time in last three sessions against the dollar and ended 13 paise up at Rs 60.03 per dollar.
As per markets experts, last minute buying was seen in equity markets after rupee showed signs of recovery and prices of oil dropped marginally. The broader index Nifty also bounced back by 98.15 points to close at 7,631.70. For both indices, Tuesday’s rise was their best since June 6 when Sensex surged 376.95 points and Nifty by 109.30 points.
Smart rise in index-based counters like RIl, ICICI Bank, ONGC, l&T, SBI, Axis Bank, Tata Motors, HDFC Bank, Bharti Airtel, Coal India, BHEl, Gail India and Maruti Suzuki helped.
Buying was so strong that 11 out of 12 sectoral indices trading on Bombay Stock Exchange (BSE) closed with gains while only FMCG finished with minor losses. Oil & gas, banking, capital goods, power and metal indices were at the forefront and surged by 2.86 per cent, 2.28 per cent, 1.93 per cent, 1.88 per cent and 1.59 per cent respectively.
Asian markets were mixed on Tuesday, following a tepid lead from Wall Street ahead of a US Federal Reserve policy meeting, while oil edged down a touch from nine-month highs as traders nervously watch the crisis in Iraq.
In the afternoon US benchmark West Texas Intermediate for July delivery fell 39 cents to $106.51 a barrel in afternoon trade, while Brent crude for August declined 42 cents to $112.52. Besides largecap stocks, BSE Mid-cap and Small-cap indices also rose on good demand from retail investors.
Positive statement by Reserve Bank of India’s Governor Raghuram Rajan on readiness to deal with any external shocks arising due to ongoing Iraq crisis boosted sentiments, experts added. Global attention has turned to the Federal Reserve’s policy meeting that wraps up on Wednesday. Expectations are for the bank to cut a further $10 billion from its monthly stimulus spending and keep interest rates at record lows.
On the domestic currency front, rupee appreciated for the first time in three days against the dollar and ended 13 paise up at Rs 60.03 per dollar boosted by late surge in local equities and comments by RBI Governor.
As per forex experts, fresh dollar selling by exporters ahead of two-day Federal Reserve’s policy meeting starting late on Tuesday also aided the rupee rise. Domestic currency started the session weak at Rs 60.35 per dollar and dropped further to an over seven-week low of Rs 60.51 per dollar, a level not seen since April 29, 2014 when it had touched an intra-day low of Rs 60.63 per dollar.
Rupee later bounced back in line with sharp rise in local equities to close at the day’s high of Rs 60.03 per dollar. In straight two previous trading sessions, it had plunged by 91 paise on fears that costlier crude due to Iraq unrest would balloon India’s fuel import bill and cause trade deficit to widen. The dollar index was up 0.06 per cent against rivals.
“The rupee was seen gaining after the Reserve Bank of India chief said India was well positioned on the external front to deal with shocks,” said Abhishek Goenka, Founder and CEO, India Forex Advisors.
On Sensex, 24 out of the 30-share index finished higher while others concluded lower. Major gainers were ONGC, Axis Bank, SBI, Coal India, BHEl, Sesa Sterlite and GAIl which rose by 4.07 per cent, 3.79 per cent, 2.91 per cent, 2.89 per cent, 2.84 per cent, 2.76 per cent and 2.55 per cent respectively.
However, M&M slid the most by 1.77 per cent, followed by Hero Motocorp 0.83 per cent and Dr Reddy’s lab by 0.58 per cent.