Sensex hits 3 week high on optimism over upcoming Budget, rate cut hope

Mumbai: Riding high on optimism over the upcoming Budget and hopes of rate cut, Indian markets rose for the sixth straight day with benchmark Sensex surging 184.38 points to close at three-week high of 29,320.26 today. [caption id=“attachment_2010825” align=“alignleft” width=“380”]  On a high. Reuters[/caption]Interest-rate sensitive counters like consumer durables, power, capital goods and auto led the rally. Positive global cues in form of higher closing at other Asian markets and jump in European stocks on speculation that Greece and its euro-area creditors may reach a compromise agreement on its bailout soon, too boosted domestic shares. The BSE 30-share barometer Sensex spurted by 184.38 points, or 0.63 percent, to close at 29,320.26. This its highest close in nearly three weeks. During today’s session, the bluechip index touched a high of 29,411.32 and a low of 29,126.91. The gauge has now gone up by 1,092.84 points, or 3.87 percent in six straight days. “Falling crude prices and relief amidst tensions over Greek economy, mixed sentiments amongst domestic market players due to constant flow of news and events related to Union budget kept markets…in a bullish tone,” said Bonanza Portfolio, Senior Vice President, Rakesh Goyal. Apart from expectations of growth-oriented Budget and faster economic reforms by government, hopes of rate cuts by RBI in view of slowing inflation, also buoyed sentiments. January headline WPI inflation contracted 0.39 percent. The NSE Nifty after shuttling between 8808.90 and 8894.30, settled 59.75 points, or 0.68 percent, up at 8,869.10. HDFC Ltd was the best gainer today among the 30-share Sensex as it jumped 2.96 percent. Other Sensex constituents that rose include Tata Power, TCS, Tata Motors, M&M, NTPC, ICICI Bank, Wipro, Coal India, Cipla, L&T and ITC. Sectorally, BSE Consumer Durables index rose the most by surging 1.81 percent, followed by Power 1.45 percent, Capital Goods 1.34 percent, IT 1.09 percent, Auto 0.89 percent, FMCG 0.72 percent and Healthcare 0.57 percent. Stocks of defence equipment makers such as Pipavav Defence and Bharat Forge perked up after Prime Minister Narendra Modi promised steps to boost domestic defence industry. Globally, European stocks edged higher in their early trade amid hopes Greece can secure a deal with its creditors. Indices in the UK, France and Germany were up 0.13-0.86 percent. Asian stocks ended higher tracking gains in the US as fears eased over Greece leaving the eurozone. Benchmark indices in Hong Kong, Indonesia, Japan and Singapore were up 0.19-1.18 percent. The Small-cap and Mid-cap indices also rose by 1.04 per cent and 0.84 percent respectively on fresh buying by retail investors. The total market breadth turned positive as 1,634 stocks in green, 1,283 finished in red while 111 ruled steady. The total turnover rose to Rs 4,162.06 crore from Rs 3,550.43 crore on Monday. PTI