Surprise Interest Rate Cut By Chinese Central Bank For The First Time In Two Years To Prop-Up Its Slowing Economy And European Central Bank President Hinting At ‘Aggressive Stimulus Measures’ Aids Rally
Mumbai : The market maintained a record breaking spree to breach new milestone with the benchmark Sensex surging 165 points to 28,500 and the Nifty index rising by 53 points to end above 8,500 mark on hopes of big-bang reforms in the ongoing winter session, reports PTI.
Already underpinned by all-round domestic positivity, the bourses got a boost due to a surprise interest rate cut by the Chinese central bank for the first time in two years to prop-up its slowing economy, in addition to European Central Bank President Mario Draghi’s statement indicating “aggressive stimulus measures” to prevent the Euro zone from sliding back to recession. People’s Bank of China had lowered its benchmark deposit and lending rates by 0.25 and 0.40 percentage points respectively.
However, the range-bound market which traded in positive terrain, witnessed bouts of profit-booking in energy and pharma counters.
Hope that the Reserve Bank of India will cut interest rate in its upcoming monetary policy on Dec 2 also aided the bull-run.
Finance Minister Arun Jaitley over the weekend made a case for lower interest rates, saying that the cost of capital must come down for reviving the economy buoyed sentiment further.
Led by smart gains in Infosys, ICICI Bank, HDFC Bank and TCS and good capital inflows, the indices extended gains for the third straight trading session. Short-coverings ahead of the expiry of November contract on Thursday and rolling over of positions to next series also aided the market sentiment, brokers said. In straight three trading sessions, it has risen by 466.69 points or 1.66 %.
According to experts, sentiment is positive right now with the onset of the winter session of parliament that will take up crucial bills like the Good and Services Tax Bill, the Insurance Laws (Amendment) Bill, 2008, the Coal Regulatory Authority Bill, 2013, among others into discussion.
“ECB’s clear decision on quantitative easing to spur the European economy also gave a boost to markets,” said Rajshekar Gowda, Senior Analyst, HBJ Capital.
IT stocks saw demand after IT major Infosys set December 3, 2014 as record date for a liberal 1:1 bonus issue.
Metal counters were in the limelight buoyed by the rate cut news from China, which is one of the biggest consumers of commodities. Shares of Jindal Steel & Power surged 4.30 %, Sail gained 3.93 % and Hindalco Industries rose 3.37 % on the BSE. Among others, Tata Steel was up 3 %, Hindustan Zinc jumped 2.99 % and JSW Steel surged 2.74 %.
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Sebi Seeks Trade Data For ING Vysya Shares Prior To Deal
New Delhi : The Securities and Exchange Board of India (Sebi) has sought details from exchanges about trades in shares of ING Vysya Bank that were conducted prior to the announcement of its Rs 15,000-crore merger with Kotak Mahindra Bank.
The details have been sought to check whether any unusual trading activities took place in the shares and whether such trades could have been conducted in violation of securities market regulations, sources told PTI.
While there have been reports about possible insider trading and unfair trades, sources said that it is too premature to suggest any such specific violation and details have been sought as of now only to check any unusual trades. Those under the scrutiny include some senior executives of ING Vysya Bank and shares acquired by them through conversion of ESOPs in run-up to the deal.
The all-share deal was announced on November 20 after markets were closed. However, the shares had seen a big jump of over 7 per cent during that day, while a gain of 3.5 per cent was registered on the previous day as well.
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