Banking on Optimism

Mumbai

Sentiments did a turnaround from cautiousness to optimism as the Nifty zoomed to a life-time high of 6,871.35 before closing to a fresh historic mark of 6,858.80 at the National Stock Exchange.

Banking shares were the star of the day spurting 5.47 per cent followed by Realty 4.82 per cent, Energy 3.52 per cent, Infra 3.49 per cent, Metal 3.21 per cent and Auto 2.30 per cent.

Banking stocks led by ICICI and HDFC Bank, today surged up to 7 per cent in-line with overall rally in the broader market. ICICI Bank gained 6.63 per cent, while HDFC Bank surged by 5.31 per cent, Axis Bank by 4.87 per cent and SBI by 3.88 per cent on the BSE.

Banking shares stole the limelight with ICICI gaining 6.63%, HDFC Bank surging by 5.31%, Axis Bank by 4.87% and SBI by 3.88%.  The BSE bankex hit an all-time high of 15,801.26 points in intra-day trade

Among others, Kotak Mahindra Bank shot up by 4.75 per cent, IndusInd Bank by 4.61 per cent, PNB by 4.94 per cent and Bank of Baroda by 2.62 per cent.

Led by the gains in these stocks, the BSE bankex jumped 5.34 per cent to close 15,721.36, becoming the top gainer among 13 sectoral indices. It scaled all-time high of 15,801.26 points in the day-trade. Investors were enthused by surge in FII inflows, ahead of the Election results as the outcome is widely perceived to be a stable, business-friendly government.

“As the elections D-day is approaching closer, markets are rallying on anticipation of a favorable outcome,” said Dinesh Thakkar, Chairman & Managing Director of Angel Broking.    Riding on continuous foreign fund inflows, the 30-share Sensex hit a new record of 23,048.49.

However, it settled the day a few notches lower at 22,994.23– record closing high– registering a rise of 650.19 points or 2.91 per cent, the biggest gain in a[two_third last=”no”][/two_third]lmost eight months. On September 19 last year, the barometer soared over 684 points.  The previous all-time high record for the Sensex was 22,939.31, recorded on April 25.

The bourses opened on sluggish note, but soon made gains as the session progressed, rallying to mark historic highs during intra-day trade. It extended the surge to end with a fresh historic high. Shares of mid-cap and small-cap companies also rallied 1.88 per cent and 2.09 per cent.

“Unmistakably, the focus remains on the approaching D-day, i.e. May 16 when the election verdict would be announced. But even before that, the market would react to exit polls numbers as it starts trickling in once the final phase of polling gets completed by May 12,” said Sanjeev Zarbade, Vice President, Private Client Group Research, Kotak Securities. Of the 30 Sensex stocks, 27 rose sharply on good demand while the remaining three declined.

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