The benchmark BSE Sensex rallied 500 points following fresh buying mainly in realty, healthcare, banking, metal and power amid mixed Asian cues as WPI inflation fell for July.
The BSE Sensex rallied 517.78 points on Friday and registered the biggest one-day gain in seven months. The benchmark index closed the day 28,067.31. On the similar lines, the NSE Nifty also jumped 162.70 points at 8,518.55.
Market sentiment boosted on hopes of a possible rate cut by the Reserve Bank of India after data released on Friday, showed wholesale price index (WPI) for July 2015, slipped further into negative terrain and stood at -4.05 per cent as compared to -2.4 per cent in June 2015. Data earlier this week showed consumer price inflation also tumbled in July.
All the twelve sectoral indices on BSE closed in green. The BSE Realty index surged the most —7.60 per cent to 1,429.03, it was followed by the BSE Bankex (up 3.05 per cent) and BSE Auto index (2.40 per cent.
Gaurav Jain, director, Hem Securities, said, “Indices staged a stellar performance on the back of buying interest till the last leg of trade. July Wholesale Price Index (WPI) contracted for ninth straight month to -4.05 percent and cooling of CPI inflation fueled the rate cut expectations that RBI governor may cut rates before its policy scheduled in September.”
In the realty space, DLF and HDIL gained 18.28 per cent and 11.45 per cent to Rs 134.90 and Rs 84.70, respectively.
Among PSU bank stocks, State Bank of India (SBI) (up 3.49 per cent), Punjab National Bank (up 8.77 per cent), Bank of Baroda (up 4.33 per cent), Canara Bank (up 5.85 per cent), IDBI Bank (up 5.58 per cent), Bank of India (up 7.89 per cent) and Union Bank of India (up 5.69 per cent) gained.
Stocks of Glenmark Pharma, Indiabulls Housing and Jindal Steel remained in action in the day due to the MSCI rejig and witnessed heavy volumes.
On the other hand Adani ports gained more than 8.5 per cent in the day after the reports that the stock would replace NMDC in Nifty from September 28.
The market breadth indicating the overall health of the market was strong. On BSE, 1,790 shares advanced and 1,054 shares fell. A total of 97 shares remained unchanged.
Vinod Nair, head, fundamental research, Geojit BNP Paribas Financial Services, said, “No further devaluation of the Yuan was announced on Friday and this provided an essential break to sectors like metal, chemical, textiles and export-oriented companies from the fall. Additionally, pharma stocks can benefit from the devaluation of Yuan.”
Asian peers, Nikkei 225 and Hang Seng declined 0.37 per cent and 0.12 per cent while Shanghai gained marginally by 0.27 per cent on Friday.