A range bound movement was witnessed as key benchmark indices continued to trade firm in early afternoon trade. At 12:24 IST, the barometer index, the S&P BSE Sensex, was up 389.45 points or 1.49% at 26,604.58. The 50-unit CNX Nifty was up 112.35 points or 1.41% at 8,063.25. The Nifty retained the psychological 8,000 level after crossing that level in opening trade. All the twelve sectoral indices on BSE were in the green.
The rally on the domestic bourses was a part of the rally in global stocks triggered by expectations that the US Federal Reserve will delay increase in short-term rates in the United States after a lackluster US jobs data released on Friday, 2 October 2015. The Sensex surged 428.39 points or 1.63% at the day's high of 26,649.34 in morning trade, its highest level in more than five weeks. The Nifty also hit its highest level in more than five weeks when it jumped 118.30 points or 1.48% at the day's high of 8,069.20 in morning trade.
In overseas stock markets, Asian stocks edged higher on expectations Beijing will take steps to accelerate growth and as prospects of a near-term interest rate hike by the Federal Reserve ebbed in the wake of last week's weaker-than-expected US employment data for September 2015. The possibility of the Fed delaying the lift-off date for rates also meant its loose policy, which has helped shore up risk assets globally by providing cheap cash, would continue a little longer. The US central bank has kept interest rates near zero since the end of 2008 in an effort to stoke economic growth in the aftermath of the global financial crisis. US stocks closed on a positive note during the previous trading session on Friday, 2 October 2015, thanks to a late-afternoon rally, but a weak US jobs report added to worries that the economy is slowing.
Closer home, broad market depicted strength. There were more than two gainers against every loser on BSE. 1,773 shares rose and 688 shares declined. A total of 93 shares were unchanged. The BSE Mid-Cap index was up 1.42%. The BSE Small-Cap index was up 1.32%. Both these indices underperformed the Sensex.
Maruti Suzuki India (down 3.16%), Dr Reddy's Laboratories (down 1.09%) and Hindustan Unilever (down 0.93%) were major losers from the Sensex pack.
Shares of power generation and power distribution companies gained. Torrent Power (up 1.11%), NHPC (up 0.9%), NTPC (up 1.58%), Tata Power Company (up 0.99%), Adani Power (up 1.02%), Power Grid Corporation of India (up 1.26%), Reliance Infrastructure (up 1.02%) and Reliance Power (up 0.8%) gained.
Bank stocks gained. Among public sector banks, UCO Bank (up 1.64%), Syndicate Bank (up 2.2%), Punjab National Bank (up 1.62%), Allahabad Bank (up 1.53%), Bank of Baroda (up 1.49%), State Bank of India (SBI) (up 1.72%), Union Bank of India (up 2.16%), Canara Bank (up 1.65%), and Bank of India (up 2.12%) edged higher. Corporation Bank declined 0.11%.
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United Bank of India gained 1.83%. The bank on Saturday, 3 October 2015, said it has decided to reduce its base rate by 25 basis points to 9.65% from 9.9% with effect from 5 October 2015. The bank has also reduced interest rate on domestic term deposits under various maturity buckets by 25 to 50 basis points.
Among private sector banks, Axis Bank (up 2.64%), HDFC Bank (up 1.87%), Kotak Mahindra Bank (up 2.9%), Yes Bank (up 2.16%), and IndusInd Bank (up 0.18%) edged higher. Federal Bank dropped 0.46%.
ICICI Bank rose 3.27% after the bank announced a reduction of 35 basis points in its base rate to 9.35% per annum from 9.7% with effect from 5 October 2015. The base rate is the minimum lending rate charged by a bank.
Index heavyweight Reliance Industries (RIL) gained 1.39% to Rs 874.25. The stock hit high of Rs 874.65 and low of Rs 862.50 so far during the day.
Cummins India rose 2.8% after the company said it has completed acquisition of the entire remaining 50% stake in Cummins Svam Sales & Service, making it a wholly-owned subsidiary of the company. It may be recalled that Cummins India's board of directors had on 28 May 2015 approved the proposal to increase the existing shareholding of the company in Cummins Svam Sales & Service, a joint venture company, from 50% to 100%, for an amount not exceeding Rs 6.50 crore. Cummins Svam Sales & Service was established as an equal joint venture company between Cummins India and Svam Power Plants. Cummins Svam Sales & Service is an authorized dealer of Cummins India in the districts of Bulandshehar, Gautam Buddh Nagar and Ghaziabad in Uttar Pradesh and Union Territory of Delhi for selling Cummins engines, parts and accessories, and providing service support to the engines.
Kalyani Steels rose 1.17% after the company said it has increased its equity stake in Lord Ganesha Minerals from existing 50% to 77.50%, making it a wholly owned subsidiary of the company. The company made the announcement after market hours on Thursday, 1 October 2015.
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