Indian equities notched up their third straight gains on Wednesday as investors felt the need to neutralise budget overreaction and move positively as improved business sentiment and positive global cues augur well.
At the closing bell, the BSE gauge Sensex was 0.87 per cent or 353.28 points higher at 41,142.66. The index has gained over 1,407 points or 3.54 per cent over the last three sessions.
While, the NSE Nifty rose 109.50 points, or 0.91 per cent, to settle at 12,089.15 -- taking the three-day gains to 427.30 points or 3.66 per cent.
Market gains were driven mainly by rate-sensitive stocks ahead of the Reserve Bank's monetary policy announcement on Thursday.
Besides, reports of a breakthrough in coronavirus treatment enthused investors.
Analysts said that buoyancy in Indian equities accelerated during the afternoon trade as India's service sector growth for January hit a seven-year high.
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On the Sensex chart, Tata Steel was the top gainer in the Sensex pack, rallying 5.14 per cent, followed by Bharti Airtel, HDFC, TCS, L&T and Reliance Industries.
On the other hand, Hero MotoCorp was the top laggard, shedding 3.83 per cent. PowerGrid, Maruti, Asian Paints and NTPC too ended with losses.
Sectorally, BSE metal, telecom, realty, industrials, capital goods, energy, oil and gas, finance, FMCG and IT indices ended up to 2.90 per cent higher, while power and utilities indices slipped in the red.
Broader BSE midcap and smallcap indices rallied up to 1.35 per cent.
"Indian markets are mirroring the global markets and trading on a higher note powered by rate-sensitive stocks. With the overreaction following the budget mostly done with, focus will shift to how global events and Q3 results pan out. With Inflation being on the higher side there is no further room left for the central bank to tweak rates and is expected to continue its accommodative stance in the policy due tomorrow," Vinod Nair, Head of Research, Geojit Financial Services Ltd, said.
India's services sector activity surged to a seven-year high in January driven by sharp increase in new business orders, leading to job creation and business optimism amid favourable market conditions, a monthly IHS Markit survey said.
Earlier this week, another survey said the country's manufacturing sector activity climbed to a near eight-year high in January.
Meanwhile, Brent crude oil futures advanced 2.76 per cent to USD 55.45 per barrel.
On the currency front, the Indian rupee ended flat at 71.24 per US dollar.
On the global arena, positive global cues persisted after Chinese policymakers promised to unveil more measures to support an economy jolted by a coronavirus outbreak.
With reports of a breakthrough in coronavirus treatment doing the rounds, global stocks surged.
Bourses in Shanghai, Hong Kong, Tokyo and Seoul settled up to 1.25 per cent higher.
Stock exchanges in Europe too opened on a strong note.
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