Sensex surges 421 pts on rate optimism, global cues | business | Hindustan Times
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Sensex surges 421 pts on rate optimism, global cues

business Updated: Jan 03, 2012 22:23 IST
HT Correspondent

Following positive domestic and international cues, the benchmark Sensex of the Bombay Stock Exchange on Tuesday ended 421 points, or 2.7%, higher at 15,939. The gain was also on account of the Reserve Bank of India indicating that it may start lowering lending rates.

The metal, consumer goods, bank and real estate stocks were the biggest gainers on Tuesday. While metals and consumer goods gained 5.1% and 4.0%, bank and real estate were higher by 4.4% and 4.3% on Tuesday.

All 13 sectoral indices of the BSE ended in a positive note with fast-moving consumer goods (FMCG) witnessing the lowest gain of 1.1%.

“The situation in Europe seems to be settling down combined with RBI’s stand on interest rates that gave a positive stroke to the market on Tuesday,” said Sunil Jain, vice-president, equity research, Nirmal Bang. “However, the upward trend may not continue till there is another positive cue.”

Sectors such as banking, IT and pharma were likely to see some gains by the end of the month, said analysts.

“Investors were taking caution with bank stocks due to the high interest rates and other factors and if there is a change of guard by the RBI, these stocks may gain. While IT and pharma stocks may gain due to the positive quarter results,” added Jain.

There were only two losers in the Sensex: M&M, down 1.1% at Rs 667 and Hero MotoCorp, which slipped marginally to 1,838.

The Nifty of the National Stock Exchange also jumped by 129 points, or 2.8%, to 4,765.

Analysts are of the view that Nifty could touch 4,900 by the middle of February on the back of more positive domestic and international news.