BSE Bankex 3.63 per cent and BSE Realty 2.28 per cent. IT shares, however, had a forgettable day with Infosys down 0.7 per cent.
Sanjeev Zarbade, Vice President- Private Client Group Research, Kotak Securities:
The Sensex rallied 385 points led by strong outperformance by the Bank Nifty as well as Capital Goods stocks. Among banks, ICICI Bank and SBI were the leading gainers. In Capital Goods, BHEL, L&T, CG and Siemens were the top gainers. The rupee strengthened while bonds prices firmed up. Global cues were also positive. Over the weekend, Iran and six world powers reached a breakthrough deal early on Sunday to curb Tehran's nuclear program in exchange for limited sanctions relief. Washington has pledged not to impose new nuclear-related sanctions over the next six months, so long as Iran sticks to its side of the deal. Following this development, Crude prices have fallen 2% to USD 108 per barrel. Going forward, important events include the 2Q GDP growth release and later followed by the election results on Dec 8.
BSE Sensex surges as oil prices drop after Iran deal (Reuters)
BSE Sensex rallied on Monday as a drop in global crude prices after Iran's deal with world powers to curb its nuclear programme sparked hopes of reduced inflationary pressures and a narrower current account deficit (CAD) at home.
Bank shares led the gains on hopes falling inflation would reduce the chances of continued rate hikes from the Reserve Bank of India.
Shares of state-run oil marketing companies also gained after Brent crude dropped more than $2 a barrel on Monday. Indian Oil Corp gained 2.7 percent, while Hindustan Petroleum Corp surged 5.8 percent.
The NSE Nifty was up 2 percent as of 0946 GMT, while the benchmark BSE index was 1.9 percent higher.