Sensex jumps 467 points as funds pick banking, oil stocks

Experts said that there is a feel-good factor in the market and an expectation that there will be visible developments over the next six to twelve months.

By: ENS Economic Bureau | New Delhi | Published:June 3, 2014 2:30 am

With markets gaining confidence from suggestive actions by the new government, the domestic bourses on Monday posted their biggest gain post the election results.

While the Sensex closed at 24,684.9 on Monday —  a day ahead of the much-anticipated policy meeting of the RBI —  with a gain of 1.9 per cent or 467 points, the broader Nifty at the National Stock Exchange gained 132 points or 1.8 per cent to close at 7,362.5.

“The pace of development, appointments at key positions and suggestive steps from various ministries are signalling that there is some action within the new government and decisions are being taken. This has lifted overall market and consumer sentiment,” said Raamdeo Agrawal, joint MD and promoter, Motilal Oswal Financial Services.

Experts said that there is a feel-good factor in the market and an expectation that there will be visible developments over the next six to twelve months.

Foreign institutional investors invested a net of Rs 234 crore on Monday after some clarity emerged on issues like clearances of projects where investments have been stranded.

For example there are talks of clearance of projects worth Rs 1.6 lakh crore in the first phase in coal, power and mining sectors.

“Just a glimpse of likely actions by the new government in the form of FDI hike in insurance and talks of clearing few large projects got the ball rolling for the market,” said Vinod Nair, head of research at Geojit BNP Paribas Financial Services.

Among the sectors, capital goods emerged as the biggest gainer at the Bombay Stock Exchange, rising by 4.9 per cent during the day. The banking and the oil & gas index, too, rose by 3.3 and 2.9 per cent, respectively.

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