Spurred by the government’s steps to push infrastructure development and an appreciating rupee, stocks rose for the fourth straight day on Thursday with BSE Sensex climbing 195 points to a one-month high of 16,649 amid investors betting on fresh stimulus by global central banks.
After gaining 434 points on Wednesday, the 30-share index opened with a 100-point gain on strong Asian cues.
The benchmark index consolidated gains further as the rupee clawed back to 54-levels intra-day and bullishness prevailed in European markets after investors expected global policy makers to enact measures to stoke economic growth.
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Financial stocks including HDFC Bank, ICICI Bank and SBI drove the Sensex up as the belief that Reserve Bank will cut rates gained further ground. These gains were supported by a smart move in heavyweight Reliance that closed 1 per cent up on its 30th AGM while shares of Infosys and ITC settled 1-2 per cent higher.
The Sensex, which had gained 489 points in last three sessions, closed higher by 194.75 points, or 1.18 per cent to 16,649.05, a level last seen on May 7.
On similar lines, the 50-share NSE Nifty regained the psychologically key 5,000-level by rising 52.55 points, or 1.05 per cent to 5,049.65.
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Making an upmove again on hopes of a fresh rate cut around June 18, 2012 when the RBI meets for a mid-quarter monetary policy review, the interest-sensitive BSE-Realty sector index gained the most today up 2.32 per cent to 1,630.21. It was followed by BSE-Bankex that rose 2.16 per cent to 11,461.62.
The BSE-Auto index shot up by 1.36 per cent to 9,189.64 while the BSE-Metal inched 1.22 per cent to 10,259.17. In fact, barring the consumer durable index, all sectoral indices were higher compared to yesterday.
Brokers also said oil hovered above $85 a barrel in Asia amid hopes that the US may implement stimulus measures to boost its recovery.
All eyes are on the U.S. Federal Reserve chairman Ben Bernanke who is scheduled to speak to Congress later on Thursday.