Reliance Industries settled at a record close while SBI, HDFC Bank, Axis Bank, Kotak Mahindra Bank and Bajaj Finance surged between 4% and 5.5%
Indian markets closed sharply higher on the weekly derivative expiry day, led by strong gains in financial stocks and Reliance Industries. The NSE Nifty 50 index ended 2.13% higher at 10,091.65 and the benchmark S&P BSE Sensex closed up 700 points at 34,208. Analysts said gains were also helped by some short-covering during the session due to the weekly futures and options expiration.
Shares of some public sector enterprises rallied after the government told the Supreme Court it was withdrawing 96% of the demands for outstanding telecoms' dues that it had raised against some state-run firms. The Nifty PSE index, which tracks state-owned firms, closed up 2.32%.
The Nifty banking index and the financial index jumped nearly 4% each. Shares of oil-to-telecom conglomerate Reliance Industries Ltd settled 2.51% higher, a record close.
Among financials, SBI, HDFC Bank, Axis Bank, Kotak Mahindra Bank and Bajaj Finance surged between 4% and 5.5%. The India VIX index, commonly referred to as fear gauge, fell 6%.
Here is what analysts said on today's market action:
Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities
“Weekly expiry day turned out to be a huge factor for the markets as Nifty closed above the levels of 10070. Bank Nifty gained 1000 points and number of blue-chip stocks also ended higher. Since the last three days, the market had been trading in a range of 200 points and was waiting for the outcome on Interest rate moratorium and the issue of AGR with telecom companies. The outcome was not harsh for the concerned sectors and that helped the sentiment turn positive. However, till the markets are trading below the level of 10350, the road ahead is not safe. The bears may try to take control of the market if Nifty starts losing its steam between the levels of 10150/10180. Our advice is to reduce weak long positions or take partial profits on long positions between 10140 and 10180 levels."
Vinod Nair, Head of Research at Geojit Financial Services.
"Despite negative global cues, Indian indices ended the day positive with steady gains. With the Supreme court AGR ruling providing a respite to the exposed banks, the relief was visible in the banking stocks especially those which had exposure to the telecom companies. The banking index contributed the most to the positivity and almost all components of the index ended the day positive. The current geopolitical situation and associated comments also gave some support to sectoral movements. Caution is advised."
Manish Hathiramani, Index Trader and Technical Analyst, Deen Dayal Investments
"The markets were successful in going past the resistance level of 10050. This is good news - we are back in an uptrend and should target 10300 as the next level of resistance."
Vishal Wagh, Research Head, Bonanza Portfolio
"Market opened flattish, though global markets were negative in the morning. In the second half, a massive short recovery led the market to touch 10106 levels for the day on the back of a recovery in foreign markets."
Ajit Mishra, VP - Research, Religare Broking Ltd.
"The benchmark indices finally regained momentum and surged over 2%, after trading sideways for the last three sessions. On the news front, participants took note of the latest developments on the AGR payment dues wherein the SC has allowed more time to the Department of Telecommunications(DOT) to review the payment proposals by the telecom companies'. The rally was well supported by banking, metal and capital goods majors and the market breadth too was inclined strongly on the advancing side."
"We expect the Nifty index to carry this momentum and inch towards 10,250 levels ahead. Meanwhile, the news related to the stand-off with China and cues from the global market will remain on participants' radar. Since all the sectors are contributing to the move, traders should maintain their focus on the stock selection."
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