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The benchmark BSE Sensex ended higher by over 200 points on Tuesday due to sustained buying by DIIs ahead of RBI monetary policy review.
The central bank’s two-day monetary policy review had begun today and the decision is due tomorrow. This has led to unabated buying by domestic financial institutions, which added to the positive mood. Rate-sensitive auto stocks made buyers sit up and take note amid encouraging September sales data.
Domestic sentiment was buoyed as the manufacturing activity expanded for a second straight month in September, with the Nikkei/Markit Manufacturing Purchasing Managers' Index steady at August's 51.2.
Trading sentiment was also boosted as Finance Minister Arun Jaitley had on Sunday indicated that the government would consider reducing the goods and services tax slabs and easing compliance burden for small taxpayers once revenues from GST better those from the previous tax regime.
Noting that there was space and scope for improvement, he said, “Eventually, once we become revenue-neutral (we can afford) to think in terms of bigger reforms such as fewer slabs …But for that, we have to become revenue-neutral-plus.”
The 30-share BSE index Sensex ended higher by 213.66 points or 0.68 per cent at 31,497.38 and the 50-share NSE index Nifty closed higher by 70.9 points or 0.72 per cent at 9,859.50.
Among BSE sectoral indices, consumer durables index gained the most by 2.23 per cent, followed by oil & gas 1.34 per cent, metal 1.18 per cent and FMCG 1.11 per cent. On the other hand, power index was down 0.49 per cent and capital goods 0.2 per cent.
Top five Sensex gainers were Tata Motors (+3.78%), Asian Paints (+2.72%), Reliance (+2.07%), Bajaj Auto (+1.79%) and Adani Ports (+1.7%), while the major losers were Power Grid (-2.16%), Maruti (-1.06%), State Bank of India (-0.97%), Cipla (-0.78%) and Bharti Airtel (-0.77%).
Asian shares rose on Tuesday, tracking record closes on Wall Street and upbeat economic data that lifted US Treasury yields and the dollar, although weaker oil prices took their toll on some market segments.
MSCI's broadest index of Asia-Pacific shares outside Japan was 0.4 per cent higher, clawing back losses from earlier in the Asian day.
US stocks started the fourth quarter on a strong note on Monday, with all three major indexes hitting record high closes as data pointed to underlying strength in the economy.
The Dow Jones Industrial Average rose 152.51 points or 0.68 per cent to 22,557.6, the S&P 500 gained 9.76 points or 0.39 per cent to 2,529.12 and the Nasdaq Composite added 20.76 points or 0.32 per cent to 6,516.72.
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