After flirting several times with their individual all-time highs in the past one month, both the benchmark indices managed to touch new lifetime highs on Tuesday.
The 30-share Sensex of the BSE surged 360.21 points, or 1.81%, to close above the psychological 20-k mark at 20,290.89 points.
The broader S&P CNX Nifty of the NSE gained 136.65 points, or 2.29%, to close at 6,097.25 points.
Anil Advani, head of Research, SBI-CAP, said, ?The surge in the markets came on anticipation that the US Federal Reserve would cut key rates by at least 25 bps at its meeting on Tuesday evening.?
The markets opened on a positive note on Tuesday taking a positive cue from global markets, coupled with heavy buying across counters creating a rally in sectoral indices.
Most of the buying was witnessed in the realty and banking space, which helped the BSE Realty index surge 359.44 points, or 3.04%, to close at 12,182.32 points followed by BSE Bankex, which gained 292.16 points, or 2.54%, to close at 11,778.71 points.
Indian equity markets have provided the best returns in Asia since the last Fed rate cut on September 19. The Sensex gained 24.31%, or 3,968 points, between September 19 and December 11 while the broader S&P CNX Nifty of the NSE swelled 29%, or 1,365 points, partially justifying a possible decoupling of the Indian markets from the US.
The only Asian peer that came close was the Jakarta Composites Index, which rose 21.51% in the same period.