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Sensex Soars 241 Points to Hit 2-month High; Banks Fuel Rally

Mumbai: Extending Tuesday’s rally, benchmark Sensex on Wednesday surged nearly 241 points to close at a two-month high of 27,140 and Nifty reclaimed the 8,300-level on widespread buying triggered by a positive start of the earnings season and firm Asian cues.

Investors cheered better-than expected Q3 numbers in IndusInd Bank along with bullish Asian stocks ahead of US President-elect Donald Trump’s news conference later in the day that will give his policy insight.

Besides, investors widened their bets on optimism that upcoming general budget — to be unveiled next month — would contain incentives for corporates, which will help boost the economy.

Anand James, Chief Market Strategist, Geojit BNP Paribas Financial Services Ltd, said, “Indian stocks opened on a firm note as banking stocks were propped up by IndusInd Bank as well as South Indian Bank’s results which lent positivity at the start of Q3 season…metal sector got a shot in the arm following reports of reduction in Chinese production.”

IT stocks remained on the back foot ahead of US President elect Donald Trump’s first press conference scheduled in the day, in the backdrop of reintroduction of bill on visa restrictions, James added.

The 30-share Sensex resumed higher at 26,978.44 and quickly breached the 27,000-mark to hit a high of 27,174.87 before winding up at 27,140.41, scoring a notable rise of 240.85, or 0.90 per cent. The Sensex had closed at 27,517.68 on November 10 last year.

The NSE Nifty also climbed 92.05 points, or 1.11 per cent, to end at 8,380.65 after trading between 8,389 and 8,322.25. (the key index had closed at 8,525.75 on November 10, 2016).

Yesterday, IndusInd Bank reported a healthy growth in its net profit by 29 per cent and the Net Interest Income increased by 34 per cent despite cash crunch created by demonetisation, as investors negated apprehension in banking sector, lapping it up by 2.40 per cent.

The broader markets outperformed the headline indices with gains covering in metal, banks, finance, capital goods, utilities and power sectors, as IT sectors incurred profit- booking on caution as investors awaiting the key quarterly results of corporates TCS and Infosys.

Meanwhile, Midcap and Smallcap shares also traded with substantial gains.

Overseas, Asian stocks ruled higher ahead of the first address of US President-elect Trump. Markets are hoping for some concrete views from him on policy and a checklist of his priorities as he meets the press today.

South Korea and Hong Kong gained 1.47 per cent and 0.84 per cent, respectively while Japan’s Nikkei 225 Average settled 0.33 per cent higher. China ended lower by 0.79 per cent.

European shares trading mixed with London FTSE gained 0.15 per cent, while CAC and Dax down by 0.60 per cent to 0.41 per cent.

Source: News18