Stocks

Sensex rallies 435 points; Nifty ends at 10,295 on Jaitley's mega stimulus plan

BL Internet Desk Chennai | Updated on January 08, 2018 Published on October 25, 2017

BSE index hits life-time high of 33,117.33 and NSE index scales historic peak of 10,340.55 in early trade

The benchmark BSE Sensex surged over 430 points and the NSE index Nifty closed at 10,295 as the Finance Minister, Arun Jaitley, had yesterday announced a massive Rs 6.92 lakh crore for infrastructure spending and another Rs 2.11 lakh crore for bank recapitalisation to revive investments and growth.

Amidst concerns over growth slowdown, the g overnment has announced plans for bank capitalisation to boost the economy, spur investments and create jobs, as well as a highway construction project.

Stressing that the macro fundamentals of the economy are strong, Finance Minister Arun Jaitley announced the ₹5.35 lakh crore BharatMala Pariyojana to construct 34,800 km of highways and an aggressive ₹2.11 lakh crore capitalisation plan for public sector banks.

The 30-share BSE index Sensex ended higher by 435.16 points or 1.33 per cent at 33,042.50 and the 50-share NSE index Nifty closed up by 87.65 points or 0.86 per cent at 10,295.35.

Among BSE sectoral indices, PSU index was the star-performer and was up 8.07 per cent, followed by banking 4.71 per cent, capital goods 3.33 per cent and infrastructure 2.23 per cent. On the other hand, consumer durables index fell 1.31 per cent, healthcare 1.11 per cent and realty 0.35 per cent.

Bank stocks soared after the Union Cabinet unveiled a $32.4-billion recapitalisation plan, while construction stocks rallied after the government approved an $82.2-billion investment plan.

State Bank of India was the top percentage gainer in the NSE index, surging as much as 29 per cent to its highest since January 2015, after the government said it would inject Rs 2.11 lakh crore ($32.40 billion) into the sector over the next two years.

Larsen & Toubro was the third-largest gainer in the index as it rose as much as 6.3 per cent.

Top five Sensex gainers were State Bank of India (+27.58%), ICICI Bank (+14.69%), L&T (+5.65%), Axis Bank (+4.61%) and Bharti Airtel (+2.76%), while the major losers were Kotak Bank (-5.43%), HDFC Bank (-3.79%), HDFC (-2.6%), Lupin (-2.22%) and Sun Pharma (-2.1%).

Nifty PSU bank index jumped as much 28.6 per cent in its biggest intraday percentage gain since January 2011, with Punjab National Bank shooting up as much as 40 per cent to its highest since February 2015.

Besides L&T, shares of major road builders such as Ashoka Buildcon Ltd, Sadbhav Infrastructure Projects Ltd and J Kumar Infraprojects Ltd also gained.

Nearly 70 stocks hit their highest in 52 weeks on the NSE.

Record-setting rally

Analysts said the actions could help improve an economy that has grown at its lowest in three years, and extend a record-setting rally in share markets this year.

“We see India continuing to set itself up well through fairly aggressive reforms, corporate discipline, favourable macros, and now a stab at addressing a key cog in that wheel. We remain positive on markets, and maintain our 11,100 Nifty target,” Edelweiss analysts wrote in a note.

Early trade

The benchmark BSE Sensex rallied nearly 500 points to a life-time high of 33,117.33 and the NSE Nifty scaled the historic 10,340.55 mark in the opening trade as the Finance Minister, Arun Jaitley, had yesterday announced a massive Rs 6.92 lakh crore for infrastructure spending and another Rs 2.11 lakh crore for bank recapitalisation to revive investments and growth.

The 30-share BSE index Sensex soared 509.99 points or 1.56 per cent to quote at an all-time high of 33,117.33 points, breaching its previous record high (intra-day) of 32,699.86 hit on October 17. The gauge had gained 224.41 points in the previous two straight sessions.

The 50-share NSE index Nifty also hit a historic high of 10,340.55 by climbing 132.85 points or 1.30 per cent. It also breached the previous record (intraday) of 10,251.85 points reached on October 17.

Asian shares trod water in early trade on Wednesday, while US Treasury yields and the dollar got a lift following a report Republican senators were leaning towards John Taylor to be the next Federal Reserve chief.

MSCI's broadest index of Asia-Pacific shares outside Japan was flat in early trade.

(With additional inputs from Reuters)

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Published on October 25, 2017
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