Monsoon, positive data propel Sensex to over 3-month high

Mumbai, April 13

Advertisement

Predictions of a good monsoon and latest inflation figures of less than 5 per cent kept market spirits high as both Indian indexes recorded more than 3 per cent gain — their highest in as many months — on Wednesday.

Auto and banking stocks in particular rallied as they hoped for better rural sales and another rate cut by the Reserve Bank of India (RBI).

Wednesday’s gains have erased almost all of this year’s losses, which, at one point, touched 3,000 points. Bullish global cues sparked by strong macroeconomic data from China and surging oil prices after reports of a deal between Russian and Saudi Arabia to cap the production also helped turn fortunes. Persistent buying by retail investors lifted the small-cap index by 1.06 per cent and mid-cap by 0.91 per cent.

BSE’s Sensex and NSE’s Nifty registered 3.86 per cent and 3.76 per cent rise, respectively.

"It is raining gains in stocks market. Participants were upbeat after a host of factors namely, forecast of good rains, further easing of consumer price inflation and a rebound in industrial production," said Shreyash Devalkar Fund Manager – Equities at BNP Paribas Mutual Fund.

Market will be shut on Thursday and Friday for Ambedkar Jayanti and Ram Navmi.

In stock specific action, Wipro finished 2.89 per cent up at Rs 584.60 after the company said its board would consider a proposal for buy-back of equity shares later this month.

Stocks of fertiliser, irrigation system and agri machinery manufacturers continued to hog the limelight for a second consecutive day, rising by up to 7 per cent, on forecast of "above-normal" monsoon this year.

From the auto pack, Mahindra & Mahindra jumped 7.40 per cent and VST Tillers Tractors rose 3.14 per cent.

Overseas, Asia ended higher after a latest data showed stronger-than-expected growth in China's exports. The Shanghai Composite settled 1.44 per cent higher, Hong Kong's Hang Seng rose 3.19 per cent, while Japan's Nikkei jumped 2.84 per cent after the yen weakened against the dollar.

Europe was also higher with indices in France, Germany and the UK gaining by up to 2.53 per cent.

Meanwhile, the IMF retained 7.5 per cent expansion forecast for India in 2016 and 2017 in its World Economic Outlook. — PTI