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The Sensex and Nifty ended higher on Friday, recording their biggest weekly gain in more than three months, as additional stimulus from the European Central Bank helped offset disappointment about the Reserve Bank of India's decision to hold rates.
The broader NSE index ended 14.9 points or 0.18 per cent higher at 8,261.75, and rose 2.16 per cent for the week.
The benchmark BSE index closed 52.9 points or 0.20 per cent higher at 26,747.18, gaining 1.97 per cent for the week.
Both indexes posted their best weekly gain since the week ended September 2.
Among BSE sectoral indices, realty index gained the most by 1.62 per cent, banking 1.14 per cent, FMCG 0.52 per cent and PSU 0.5 per cent. On the other hand, auto index was down 0.46 per cent, metal 0.23 per cent, capital goods 0.15 per cent and healthcare 0.07 per cent.
Top five Sensex gainers were SBI (+2.41%), ICICI Bank (+2.35%), ONGC (+1.61%), Axis Bank (+1.51%) and L&T (+1.2%), while the major losers were Bajaj Auto (-2.05%), Coal India (-1.6%), HDFC (-1.56%), M&M (-1.43%) and Hero MotoCorp (-0.84%).
Banks were among the leading gainers, despite the RBI's surprise rate move after it reversed an order that had forced lenders to surrender all their extra cash and place it under the cash reserve ratio.
Global sentiment was also buoyed after Wall Street hit record highs on Thursday and after the ECB extended it asset-buying programme for a longer period than many analysts had expected, though it trimmed the size of its purchase.
Asian shares, however, edged down on Friday with MSCI's broadest index of Asia-Pacific shares outside Japan dipping 0.3 percent.
“Yesterday, the markets captured the announcement that was expected from the ECB, which has now decided to continue with its stimulus package,” said Saurabh Jain, assistant vice-president of research at SMC Global Securities.
A report by SMC Global said "Asian markets mostly traded slightly on lower side despite good gain in US market. Under the ECB meeting, it has been decided to reduce its monthly asset purchases to 60 billion euros from April 2017 from the current 80 billion euros. US stocks are following the gaining trend and again closed at record high. Under the US market, investors are optimistic about domestic economic stimulus and reduced corporate taxes and regulations. Moreover, oil service stocks showed a strong move due to strong rally in crude oil prices.The European Central Bank kept its refinance rate unchanged at a record low at zero percent. Consumer prices in China are up 2.3 per cent on year in November. Japan Q3 GDP is down to +0.3% on quarter in the third quarter of 2016 and 1.3% from 2.2% on yearly basis."
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