The benchmark Bombay Stock Exchange (BSE) 30-share Sensitive Index (Sensex) gained 375.72 points or 1.81 per cent on Monday, its biggest gain in the new calendar year 2014. It closed at 21134.21.
The rupee also moved up strongly against the dollar to close at 61.55 a dollar compared to its previous close of 61.89 on last Friday.
IT stocks, TCS and Infosys, led the rally with more than 3 per cent appreciation. Infosys recorded a healthy third quarter earnings, last Friday. This seemed to have paved the way for the entire information technology (IT) industry, as the BSE IT Index appreciated by 2.92 per cent.
Following the surge in IT stocks, tech shares gained 2.40 per cent, oil & gas 2.24 per cent, banks 2.04 per cent and capital goods 1.55 per cent. Among the sectoral indices, health care ended in the red with a loss of 0.68 per cent. Among the broader indices, BSE 100 gained 1.41 per cent, BSE 200 1.25 per cent and BSE 500 1.17 per cent.
Meanwhile, BSE mid-cap index gained marginally by 0.15 per cent while small cap index was up by 0.37 per cent.
On the National Stock Exchange (NSE), the Nifty closed at 6272.75 with a gain of 101.30 points or 1.64 per cent.
“Investors shrugged off weak industrial production data as firm global cues and appreciation in rupee against the dollar aided market sentiment. As a result, Nifty was seen gaining nearly two per cent. The day was dedicated to index heavyweights, especially from the IT sector, followed by the oil & gas and banking”, said Jayant Manglik, President-Retail Distribution, Religare Securities.
According to Mr. Manglik, the under-performance of interest rate sensitive sectors is holding back the index to retest the all-time high further northward. So, ease in inflationary pressure would help policy makers to reduce or avoid further hike in policy rates which directly impact the growth.
Inflation figures, consumer price index and wholesale price index, hold the key for next directional move in domestic markets.
The rupee gained 38 paise to close at one-month high of 61.52 against the dollar as exporters and banks sold dollars.
The rupee was also supported by weakness in dollar overseas after disappointing U.S. jobs data announced last weekend eased concerns about the Federal Reserve’s tapering of the stimulus programme, a forex dealer said.