A deferral of the controversial General Anti Avoidance Rules (GAAR) that is expected to boost sentiments of foreign investors by three years helped the benchmark Sensex gain 243 points, or 1.2%, at 19,906 — the highest in the last 24 months.
A dip in inflation fuelling rate cut hopes and strong profit growth by Tata Consultancy Services also aided sentiments.
The Nifty shot up by 72.8 points, or 1.2%, at 6,024.
“The market sentiment was boosted by finance minister P Chidambaram’s decision to defer implementation of GAAR from April 2014 to 2016,” said Sanjeev Zarbade, vice-president, private client group research, Kotak Securities said. “Infosys shares extended its rally on Monday by around 4%. Post December inflation number, expectations of a rate cut have further strengthened.”
DLF, HDIL, Essar Oil, Union Bank and Indiabulls Finance remained the biggest gainers on Monday with 7.7%, 5.8%, 5.7%, 5.25 and 5.1% jump. While JP Power, Pidilite Industries, Bajaj Finance, MCX and Maruti Suzuki were the biggest losers with a fall of 4.7%, 2.7%, 2.4%, 1.9% and 1.7%.
Investor wealth zoomed by Rs. 84,000 crore to Rs. 70.8 lakh crore as nearly five out of ten stocks among 3,007 scrips traded on the Bombay Stock Exchange ended with gains. In all, 11 out of 13 sectoral indices closed with gains.