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Benchmark indices ended higher by almost 2% with the Nifty50 index hitting the highest mark since August, 2015, supported by strong global cues as stronger-than-expected US jobs report suggested that recovery in the world's largest economy was back on track.
The S&P BSE Sensex zoomed 500 points to end at 27,627, the highest level since August 20, 2015. The Nifty50 surged 145 points to close the session at 8,468 after hitting an intra-day high of 8,475, its highest level since August 19, 2015.
The Nifty Bank also closed at its highest level since August 19, 2015. In the broader market, the BSE Midcap index hit a record high of 12,079 and the NSE Midcap 100 hit 14,299 mark.
Commenting on today's rally, Vinod Nair, Head of Research, Geojit BNP Paribas Financial Services said," Positive US job data and expectations of a good start to the first quarter earnings season helped the market to rally. Market participants expect the rising stability in US economy is unlikely to support the FED to make any changes in the interest rate in the near term due to the prevailing ambiguity caused by Brexit. This will provide a space to EMs like India to attract foreign funds."
IIP and inflation data, quarterly earnings from blue-chips TCS and Infosys and progress of monsoon rains will be key determinants for the stock market this week, say experts.
Asian and European markets enjoyed a relief rally on Monday as upbeat US jobs data lessened immediate concerns about the health of the world's largest economy, while the long-run fallout from Brexit kept sovereign yields near record lows.
MSCI's broadest index of Asia-Pacific shares outside Japan jumped 1.9% to a one-month top. Australia added 1.8% and Shanghai 1%. Japan's Nikkei climbed 3.5%, its biggest daily gain in three months, following a clear win by the government in upper house elections. In Europe, CAC, DAX and FTSE surged between 0.6%-1.3%.
Back home, rupee traded higher by 20 paise at 67.16 against the US dollar today as exporters and banks stepped up selling of the American currency.
"We expect market to stay strong and some follow up buying as it has breached key resistance level of 8,400 in today’s trading session. Any short term intraday pull back or correction is expected to reverse quickly as market internal seems extremely strong. Important support is at 8,420 and resistance is visible around 8,500-8,520," adds Rohit Gadia, Founder & CEO, CapitalVia Global Research.
Barring Axis Bank, all the Sensex 30 stocks ended in positive zone. Shares of three private sector banks – HDFC Bank, IndusInd Bank and YES Bank –hit their respective lifetime highs on expectation of robust earnings for the first quarter (April –June) of the current financial year 2016-17.
However, IndusInd Bank slipped by 0.3% after reporting a 26% rise in standalone net profit at Rs 661.38 crore for the first quarter ended June.
Shares of non-banking financial companies (NBFC) were on a roll with most stocks hitting their respective 52-week highs on the BSE today.
Bajaj Finance, LIC Housing Finance, GIC Housing Finance, Bajaj Finserv and Mahindra & Mahindra Financial Services from the BSE500 index hit record highs, while Bharat Financial Inclusion (formerly SKS Microfinance), Gruh Finance and Shriram Transport Finance touched their multi-year highs on the BSE.
Bajaj Finance surged almost 5% after the company announced that its board will meet on July 26 to consider sub-division of equity shares of the company and bonus issue.
Tata Motors rose 4% after the company reported a 21% rise in its global wholesales at 92,551 units in June 2016 over June 2015.
Domestic passenger vehicle sales grew 2.68% to 2,23,454 units in June from 2,17,620 units in the same month last year. However, car sales were down 5.18% to 1,54,237 units as against 1,62,655 units in June last year, according to data released by the Society of Indian Automobile Manufacturers (SIAM). Maruti Suzuki gained almost 3%.
L&T Infotech hit the capital markets today to raise up to Rs 1,243 crore through an initial share sale offer. L&T surged almost 2%.
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German conglomerate ThyssenKrupp on Saturday defended merger talks with Indian rival Tata Steel saying the consolidation of the sector in Europe was necessary due to the "difficult economic situation". Shares of Tata Steel shined nearly 3%.
Private sector HDFC Bank plans to focus on digital platforms in rural and semi-urban markets to achieve sustained growth in the coming years. The stock was up 2%.
Dishman Pharmaceuticals & Chemicals gained by 3% after the company on Saturday announced inspection of its Bavla plant has been successfully completed by the United States Food and Drug Administration (USFDA).
Cadila Healthcare moved higher by 3.5% after the company announced that it has received final approval from the US drug regulator for an oral anti-diabetic drug.
