Bank stocks drive markets up

Bank stocks drive markets up
Highlights

Indian stock markets continued their post-Budget buoyancy for second day on Wednesday, driven by gains in banking stocks after RBI eased capital requirement rules for lenders.

Sensex surges forward by 464 points while Nifty rises 146 points

Mumbai: Indian stock markets continued their post-Budget buoyancy for second day on Wednesday, driven by gains in banking stocks after RBI eased capital requirement rules for lenders. The Reserve Bank has on Tuesday allowed lenders to expand their capital base under the upcoming Basel III rules, sending banking stocks up.

Rupee also boosted sentiment as it firmed up against the dollar to 67.59. Sentiment remained bullish as buying paced up after the government stuck to its fiscal deficit target in this week’s Budget announcement. The 30-share benchmark BSE Sensex, after a gap-up opening, rallied further and closed the session higher by 463.63 points, or 1.95 per cent, at 24,242.98 - its highest closing since February 8.

The index had posted its biggest single-day gain of 777.35 points in almost 7 years in Tuesday’s trade. Now, the Sensex has gone up by over 1,240 points, posting its best two-day gains in almost seven years. The 50-share NSE Nifty, after reclaiming the crucial 7,300-mark, settled at 7,368.85, up 146.55 points, or 2.03 per cent.

Shares of state-owned banks such as SBI, PNB, Bank of Baroda were at the centre of buying activity. Among the 30 Sensex components, SBI was the star performer surging the most (up 11.50 per cent) to Rs 180.85, followed by ICICI Bank (7.36 per cent) to Rs 220.20. Gains in Adani Ports, Hero MotoCorp, BHEL, Tata Steel, Axis Bank, NTPC, HDFC and Maruti Suzuki supported the upside.

As many 23 stocks gained while seven led by M&M, Coal India, and Sun Pharma finished in the red. Among sectors, the BSE realty index jumped most by rising 5.05 per cent, followed by banking (4.92 per cent), infrastructure (2.84 per cent), PSU (2.57 per cent), IT (2.49 per cent) and power (2.13 per cent).

The broader markets too continued to trend firm as retail investors boosted their bets, with the BSE small-cap index rising 2.21 per cent and mid-cap 1.88 per cent. Asian shares, including those of Hong Kong, Japan, Singapore and Shanghai, remained in the positive territory while Europe ruled high on speculation that the global economic recovery will gain traction. Foreign portfolio investors (FPIs) net bought shares worth Rs 1,760.98 crore on Tuesday, provisional data from stock exchanges showed.

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