The BSE Sensex closed over 260 points on Wednesday following firm Asian cues amid rate cut hopes and expectation that India will import cheap oil from Iran on the back of the nuclear deal.
Sensex ended above 28,000 mark by surging 265.39 pts to 28,198.29. NSE Nifty climbed 69.70 pts to 8,523.80, marking its highest close in nearly three months.
We take a look at 5 key points behind the Sensex rise:
1. Rate cut hopes: As the both consumer price index (CPI) and wholesale price index(WPI) were in line with earlier estimates, it raised hopes that Reserve Bank of India may go for rate cuts.
2. Oil Prices: Lower crude oil prices will help India control its twin deficits and inflation and create headroom for the central bank to ease borrowing costs further.
3.Maruti Suzuki shares: Buying by investors in selective bluechip stocks at prevailing levels and a firm trend at other Asian markets after data showed China’s economy grew more than expected in the second quarter helped the markets recover. Maruti shares rose to touch a record high after Brokerage Credit Suisse increased its target price to Rs 5,100 from Rs 4,370 earlier and maintained the outperform rating on it. This also contributed to stock markets rise.
4. Continued buying interest by foreign investors helped lift the market sentiment. Foreign investors bought shares worth around Rs 270 crore on Tuesday.
5. The Greek parliament’s vote on EU-prescribed austerity measures later in the day is also being keenly watched by the investors.
With agency inputs