Sensex soars to 2-yr high on GAAR deferral, rate cut hopes
Registering its best gain in the calendar year, the BSE 30-share index remained in positive throughout the day to settle at 19,906.41 - a rise of 242.77 points or 1.23 percent.
Similarly, the 50-share NSE index Nifty shot up by 72.75 points, or 1.22 per cent, to 6,024.05.
Inflation based on the wholesale prices declined to a three-year low of 7.18 per cent in December, triggering buying in stocks. "Today's inflation print has actually strengthened the debate over whether the RBI should deliver a 25bp or a 50bp rate cut on January 29," said Barclays Research.
Soon after, the government said it has postponed implementation of controversial GAAR by 2 years to April 2016.
"The market sentiment was boosted by Finance Minister P Chidambaram's decision to defer implementation of General Anti-Avoidance Rules," Sanjeev Zarbade, Vice President, PCG Research, Kotak Securities.
Investor wealth zoomed by Rs 84,000 crore to Rs 70.80 lakh crore as nearly five out of ten stocks among 3,007 scrips traded on BSE today ended with gains.
In all 11 out of 13 sectoral indices closed with gains with realty, IT, Teck, consumer durable, refinery and PSU segments leading the pack while only auto and pharma sectors ended in negative terrain.
ONGC was the best gainer in Sensex as it rose
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