Sensex, Nifty end at three-month high amid global rally

The BSE Sensex rose more than 1 per cent on Tuesday to its highest close in three months as expectations for continued foreign buying, as part of a powerful rally in global equities, lifted blue chips such as ITC.

Global shares hit their highest level in almost five years on Tuesday, a day after the S&P 500 closed at another record high, on continued optimism over last week's strong U.S. jobs report. Japan's Nikkei average jumped 3.6 per cent to its highest in nearly five years.

Hopes of foreign inflows and government efforts to revive the economy are supporting markets after the Reserve Bank of India cut interest rates for a third time this year, although it signalled little room for further policy easing.

Foreign funds have bought a net $680 million of Indian stocks in the three sessions to May 3, taking the 2013 net buying to a total of $12.17 billion, regulatory data shows.

"Worldwide economies are reviving due to quantitative easing and countries like India should continue to benefit from portfolio flows in the medium term," said R.K. Gupta, managing director at Taurus Mutual Fund.

The BSE Sensex rose 1.09 per cent, or 215.31 points, to end at 19,888.95, its highest close since January 31.

The Nifty rose 1.21 per cent, or 72.50 points, to end at 6,043.55, closing above the psychologically important 6,000 level, posting its highest close since January 30.

Among blue chip stocks, ITC Ltd gained 2.8 per cent, while Tata Motors Ltd rose 2.5 per cent.

Private sector lenders also gained, with ICICI Bank Ltd and HDFC Bank Ltd rising 1.9 per cent each.

DLF Ltd rose 2.9 per cent on its plans to sell up to 81 million shares through an institutional placement. The price range and size are yet to be determined, according to the term sheet seen by Reuters.

Sintex Industries Ltd shares rose 4.8 per cent after its January-March profit surged 65.5 per cent from a year earlier.

Aban Offshore Ltd rose 3.5 per cent after signing a contract to deploy a jack-up rig, with estimated revenue of about Rs 828 crore.

Among stocks that fell, Ranbaxy Laboratories Ltd closed 0.3 per cent lower, a day before its March quarter earnings.

StarMine's SmartEstimates, which places greater emphasis on forecasts by top-rated analysts, expects Ranbaxy to report a profit of Rs 156 crore for the quarter, higher than the wider consensus mean estimate of Rs 141 crore.


Copyright Thomson Reuters 2013