Extending the gaining streak for the seventh week in a row,the BSE benchmark Sensex gained nearly 541 points to end the week at over six-month high of 18,289.35 on hopes of cut in key policy rates by RBI after fall in overall inflation coupled with furious capital inflows.
On the global front,the European Central Bank (ECB) and European officials were moving closer to an agreement to end Greece’s funding gap,which could clear way for approval of a second bailout as soon as Monday and also strong US economic data that spurred investors into riskier assets like equities.
Back home,headline inflation,measured by the Wholesale Price Index (WPI) dropped to 6.55 per cent in January,the lowest since December 2009 when it was 7.15 per cent,which may prompt the apex Bank to cut policy rates in the coming months.
As a result,interest rate sensitive realty,banking and auto stocks were in keen demand. Power,capital goods and consumer durable counters too attracted heavy buying.
Overall 12 out of 13 sectoral indices closed in the green between 0.44 per cent and 10.18 per cent while only BSE-Oil & Gas declined by 1.44 per cent following fall in the top heavyweight RIL on reports of a likely decline in gas output from the company’s KG-D6 oil block in next fiscal.
The BSE benchmark Sensex crossed its 18K mark after a a gap of 6-1/2 month before ending the week at 18,289.35,showing a gain of 540.66 points or 3.05 per cent from its last weekend’s level.
Previously,it had ended at 18,314.33 on August 1,2011. It has risen by 2,834.43 points or 18.34 per cent in the straight seven weeks.