Indian shares rose nearly 1 per cent on Monday, marking their highest intraday level in two weeks as traders churned positions in favour of defensive stocks, especially among drug makers, a day ahead of the central bank's policy review.
Sun Pharmaceutical Industries surged as much as 9.2 per cent during the day to mark a record high of 1,181 rupees, leading gains in the CNX Pharma Index.
The BSE index and the NSE index rose 0.86 percent each, after earlier marking their highest daily level since March 19.
The Sensex finished 0.86 per cent higher or 244.32 points at 28,504.46 while the Nifty gained 73.65 points or 0.86 per cent to 8,659.90.
The Reserve Bank of India will most likely leave its benchmark interest rate unchanged at 7.50 per cent at the April 7 policy meeting, but reduce it by 25 basis points by the end of June, a Reuters poll found.
"This churn in defensives will be short lived as at least a CRR cut should come, while a surprise rate cut cannot be ruled out," said G. Chokkalingam, founder of Equinomics, a Mumbai-based research and fund advisory firm.
Stocks so far have ignored concerns over US and European investor groups calling for the Indian government to urgently clarify its tax regime for foreigners, following surprise attempts by tax inspectors to claw back money they say is owed on years of previously untaxed gains.
Pharmaceutical shares outperformed, with Sun Pharma gaining as much as 9 per cent to hit an all-time high of Rs 1,181.
Nifty gainers include Sun Pharma (8.95%), Dr Reddy's (4.55%), GAIL (4.22%), Cairn (4.03%) and ONGC (3.82%).
Top 5 losers on the Nifty are : PNB (2.04%), Wipro (2.03%), Tata Steel (1.93%), Reliance (1.48%) and IndusInd Bank (1.22%).
All sectoral indices barring metals and banks were in the green.
Shares of realty (6.43%), health care (+4.843%), FMCG (+2.35%), consumer durables (+2.06%), and oil and gas (+1.26%) saw hectic buying.
Sun Pharma rises to record: Sun Pharmaceutical Industries gained as much as 7 per cent to hit all-time high of Rs 1,155/share. Medicines Company has settled Angiomax drug patent litigation with Sun. The company will permit Sun Pharma unit to market generic bivalirudin product in US on June 30, 2019, or earlier in some circumstances. The market size of this drug is estimated at $600 million, according to analysts. Sun Pharma is expected to enjoy six months exclusive sales on this drug. On the BSE, the stock was up 7.35 per cent at Rs 1,157.80.
Adlabs : Adlabs Entertainment Ltd today fell as much as 13.8 per cent from the issue price of Rs 180 on stockmarket listing. The stock has recovered most of the intraday losses and finished at Rs 191.50 on the NSE.
Reliance Infra: Reliance Infra shares were trading down 2.62 per cent or Rs 11.60 at Rs 430.80 on the NSE on reports that the Delhi government had asked power distribution companies to clear dues of about Rs 6,000 crore ($965 mln) owed to the state.
SUN TV bleeds : Shares of Sun TV slumped after the Enforcement Directorate attached assets worth Rs. 742.58 crore in the name of former Telecom Minister Dayanidhi Maran, his brother Kalanithi and other family members in connection with money laundering probe in Aircel-Maxis deal. Shares finished with losses of 10 per cent or Rs 45.60 at Rs 410.40 on the NSE.
A report by SMC Investments and Advisors said: "Asian stocks posted a mixed open today, following the absence of a lead from US markets and as the closely-watched US nonfarm payrolls figure came in far below expectations. Wall Street was shuttered for the Good Friday holiday last week, alongside major markets in Europe and most parts of Asia. In the latest in a recent string of disappointing economic data, the Labor Department released showing that employment in the US rose by much less than expected in the month of March. The report said non-farm payroll employment rose by 126,000 jobs in March following a downwardly revised increase of 264,000 jobs in February. Economists had expected employment to increase by about 245,000 jobs compared to the addition of 295,000 jobs originally reported for the previous month. With the much bigger than expected slowdown, the pace of job growth slowed to its lowest level since December of 2013."
Among other Asian markets, Japan's Nikkei 225 index ended 0.2 per cent lower at 19,397.98 points. Financial markets in Hong Kong are closed for public holiday.
The trading in Indian market in the early part of the week will be dominated by the RBI’s monetary policy meeting scheduled for Tuesday. Rajan’s action can either send stocks soaring or crashing, depending on whether rates are cut or status quo is maintained.
It was a valiant fight-back by the bulls in Indian market last week. Just as the Sensex and the Nifty appeared ready to breach their long-term 200-day moving averages to launch into medium-term correction, a flurry of buying helped the indices pull back from the brink to end almost 3 per cent higher.
With the first three months of the year behind us, India has not done too well compared to global indices. The best performing stock index in the March 2015 quarter is the Venezuelan index that has gained 41 per cent. Another South-American index, Argentina’s index, comes next with 25 per cent gain. The index that has everyone spell-bound over the past month is the Shanghai Composite Index, up 20 per cent in the first three months despite concerns on slowing Chinese economy.