Sensex jumps 322 points on rising rate cut hopes

Auto, bank stocks lead the market surge, M&M biggest gainer with 4.89% rise

By: ENS Economic Bureau | Mumbai | Published:May 30, 2015 2:30 am

The benchmark Sensex registered a 322-point rise to touch 27,828.44 on Friday as investors built up fresh long-positions on anticipation that the Reserve Bank of India (RBI) would cut the repo rate in its credit policy meet on Tuesday.

The gain in equity benchmarks was also a reflection of the optimism among the participants ahead of the release of GDP data by the Centre.

The markets witnessed across-the-board buying mostly in banking and auto stocks with Mahindra & Mahindra (M&M) gaining 4.89 per cent on the BSE after it reported March quarter results during market hours. Bharti Airtel at 5.98 per cent was the best Sensex gainer, followed by M&M, GAIL (2.30 per cent), Maruti Suzuki (2.26 per cent) and Coal India (2.14 per cent.)

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HDFC Bank rose 2.12 per cent, while Axis Bank advanced 1.75 per cent to its highest close since March 10. The S&P BSE India Bank index rose 1.5 per cent to a six-week high.

Moreover, beginning of June series in the derivatives segment, supported the upside in stock prices, traders said. The 30-stock index opened on a positive note at 27,553.03 but quickly slipped into the red on profit-booking. Later, it bounced back at a rapid pace to hit day’s high of 27,888.32. The gauge finally settled 321.73 points or 1.17 per cent highe at 27,828.44, its biggest since May 18.

On similar lines, NSE Nifty recaptured the 8,400-mark by rising 114.65 points or 1.38 per cent to 8,433.65 after hovering between 8,443.90 and 8,305.70, intra-day.

In overseas markets, European stocks were trading lower on Friday after the head of the IMF warned that Greece could fall out of the euro zone. Key indices in Germany, France and the UK were off between 0.27 and 1.08 per cent.

“Being the first day of June F&O series, the markets rallied despite weak European market cues. The European markets fell for a second day as the Greece has not reach a debt agreement with creditors,” said Alex Mathews, head of research of Geojit BNP Paribas Financial Services. Asian stocks were trading narrowly mixed.

Rupee down 2 paise on dollar demand

The rupee ended marginally lower by two paise at 63.82 against the American currency on month-end dollar demand from importers amidst a higher greenback in the overseas market.

The rupee opened almost flat at 63.81 as against last closing level of 63.80 at the Forex market, but firmed up to 63.69 on selling of dollars by banks on hopes of foreign capital inflows in view of strong recovery in the equity market.

(With PTI inputs)

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