The Sensex and Nifty reversed early losses to end higher on Thursday, with IT stocks such as Tech Mahindra Ltd and Tata Consultancy Services Ltd contributing to majority of the gains.

The broader NSE index closed 9.35 points or 0.11 per cent higher at 8,778.40, while the benchmark BSE index also gained 39.78 points or 0.14 per cent to close at 28,329.70.

Both indexes had fallen as much as 0.5 per cent earlier in the session.

The NSE index posted two consecutive sessions of gains, while the BSE index snapped two straight days of losses.

Among BSE sectoral indices, IT index gained the most by 1.64 per cent, followed by TECk 1.62 per cent, consumer durables and realty 0.8 per cent each. On the other hand, metal index was down 0.73 per cent, banking 0.47 per cent, PSU 0.36 per cent and capital goods 0.29 per cent.

Top five Sensex gainers were TCS (+2.72%), Hero MotoCorp (+1.34%), Infosys (+1.24%), GAIL (+1.23%) and M&M (+1.06%), while the major losers were Cipla (-2.65%), Tata Steel (-2.29%), NTPC (-2.09%), L&T (-0.91%) and Sun Pharma (-0.84%).

RBI policy stance

Bank stocks were down after the central bank kept its policy rates on hold and said it would shift its stance from "accommodative” to “neutral,” signalling an end to any further rate cuts.

Analysts had expected the Reserve Bank of India to cut the repo rate by another 25 basis points, either on Wednesday or at its next review in April, after bringing it down by 175 bps during January 2015 to October last year.

Analysts had expected the Reserve Bank of India to cut the repo rate by another 25 basis points, either on Wednesday or at its next review in April, after bringing it down by 175 bps during January 2015 to October last year.

Indian stocks hit four-month highs earlier this week in anticipation of that easing, but analysts said there were still positives from the RBI meeting, including expectations banks would have scope to lower their lending rates if the system remains flush with liquidity.

“The market had already discounted RBI's rate cut decision before it happened,” said Mugilan K, deputy manager of research at Cholamandalam Securities.

“With earlier RBI rate cuts not yet fully implemented by banks, the current decision wouldn't have mattered as much.”

Asian shares

Asian shares climbed to their highest in more than 18 months on Thursday, as investors grew more confident about the world’s second-largest economy, while the dollar slightly firmed in the wake of growing concerns over political instability in Europe.

MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.4 per cent to their highest since July2015 with Hong Kong, Taiwan and China among the region's best performing markets.

The S&P 500 ended slightly higher on Wednesday as investors digested mixed earnings reports, while the Dow Jones Industrial Average slipped as bank stocks weighed.

The Nasdaq gained moderately to close at a record high for a second straight day, lifted by big tech names such as Facebook and Apple.

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