Markets staged a massive pull-back rally today with the benchmark BSE Sensex logging its biggest single-day rally of 777 points in nearly seven years and rupee rising by 57 paise as the government's commitment on fiscal deficit fanned hopes of a rate cut by Reserve Bank.
In the process, total investor wealth of BSE-listed firms went up by by Rs 2,51,743 crore to Rs 88,34,888 crore.
The rally helped the broader Nifty to recapture its crucial 7,200-point level.
The BSE Sensex after gap-up opening continued stride as buying activity gathered momentum and closed at 23,779.35, a jump of 777.35 points or 3.38 per cent.
Today's gain is the biggest single-day rise since May 18, 2009 when the 30-share barometer had jumped 2,110.79 points.
The gauge had lost 152.30 points in yesterday's highly volatile session.
The NSE Nifty at the close was up 235.25 points or 3.37 per cent at 7,222.30.
According to a private survey, manufacturing activity expanded for a second consecutive month, which too served as as a feel-good factor.
Value-buying in several battered stocks and covering-up of short positions provided further momentum, brokers said.
UBS, the global financial services major, in a research note said Reserve Bank is likely to go for a 50 basis point rate cut this calender year as the Budget gives the central bank sufficient room to adopt a more accommodative stance.
Globally, most Asian markets closed up after the China's central bank cut bank reserve requirements to boost the sluggish economy and a higher opening in European markets were other factors behind today's rally, equity brokers said.
In sync with local equities and dollar's weakness in global market, the Indian rupee also strengthened by 57 paise, to close at 67.85 against the American currency at the Forex market.
Gains were led by rate-sensitive financial and and realty stocks that witnessed huge buying activity.
Tracking overall trends, buying activity also extended to the broader markets with Small-cap and mid-cap indices also shooting up.
Gold prices in national capital eased by Rs 5 to Rs 29,400 per 10 grams today due to slackening demand from jewellers even as the precious metal strengthened overseas.
Globally, in London, gold rose by 0.53 per cent to USD 1,244.90 an ounce and silver by 0.87 per cent to USD 15.02 an ounce.
