Mumbai, India (BBN) – The Sensex and Nifty were trading higher by nearly 1.5 per cent on widespread buying by participants tracking firm global cue in anticipation of the European Central Bank extending stimulus.
Brokers said widespread buying by investors as well as foreign funds on positive Asian cues after US stocks hit fresh highs and hopes that ECB will extend its stimulus amid optimism about the American economy after the presidential election mainly bolstered the domestic sentiment, reports The Hindu Business Line.
At 12:35pm, the 30-share BSE index Sensex was up 382.62 points or 1.46 per cent at 26,619.49 and the 50-share NSE index Nifty was up 119.15 points or 1.47 per cent at 8,221.20.
Kamlesh Rao, CEO, Kotak Securities, said: “Monetary policy committee’s status quo stance on the rate has been already discounted by the market. This move is slightly negative for the rate sensitive sectors. However, the announcement on CRR is positive for banks.The next RBI policy date is slated for 7-8 February, post FY18 Budget announcement on 1st February, 2017. We expect the MPC to cut rates in the next policy meet depending on the fiscal outcome. There are strong feelers that Fed will almost certainly increase the rates in the upcoming December meet. If the Fed increases the rates and we would be reducing the rates, there could be some pressure on the currency and which could then have an inflationary effect on the economy. Apart from triggering bouts of high volatility in the financial markets, these macroeconomic implications for emerging markets economies could trigger the FIIs to stay invested in the US markets.”
Among BSE sectoral indices, metal index gained the most by 2.99 per cent, auto 2.49 per cent, infrastructure 1.64 per cent and consumer durables 1.54 per cent.
Top five Sensex gainers were Tata Steel (+4.38%), Tata Motors (+3.85%), Maruti (+2.88%), Adani Ports (+2.85%), and Bajaj Auto (+2.37%), while the only two losers were NTPC (-0.74%) and Dr Reddy’s (-0.07%).