At 3.10 pm, the BSE Sensex traded at 19,033.15, up 301.99 points, or 1.61 per cent. The NSE Nifty rose 100.65 points, or 1.77 per cent, to 5,789.35.
The current account deficit has emerged as a big weak spot in Asia's third largest economy since last year. It is expected to have hit about 5 per cent of GDP in the fiscal year that ended in March, but a fall in gold and oil prices along with the uptick in exports since January should take some of the pressure off.
Macroeconomic data flow over the last couple of weeks has been encouraging. Both retail and wholesale inflation have come in at levels lower than expected in the month of March, raising hopes that the Reserve Bank of India will cut interest rates in its credit policy review on May 3 to boost industrial growth.
Rate-sensitive stocks gained after Indian 10-year bond yields fell to 7.76 per cent, the lowest since July 28, 2010, further stoking rate cut hopes.
In other positive news, the Supreme Court today allowed nine more iron ore mines to resume production in Karnataka. Analysts say the judgement is a positive for the steel sector.
JSW Steel said the order "will have a positive impact on the steel sector and the Indian economy". "This relief not only provides a breather to the steel industry in the region, but also assists in providing of direct and indirect employment and livelihood for several people employed in this sector at a time when the steel industry was on the brink of closure due to non-availability of iron ore," Seshagiri Rao, joint managing director of JSW Steel, said in a statement today.
The IT pack refused to shake off their blues, and even in-line results from TCS and HCL Technologies met with cold response. Worries over earnings, being hit by an appreciating rupee, and a proposed US Senate immigration bill, that may lead to outsourcing firms paying higher fees and wages to H-1B visa workers, rattled investors. Wipro was down 2.93 per cent, TCS fell 0.75 per cent, and HCL Technologies fell 2.36 per cent. The BSE IT index fell 0.77 per cent. Infosys bucked the trend, however, rising 0.37 per cent on value buying.
Shares in oil marketing companies continued their gains, on hopes that the falling global crude prices will result in lower the cost of under-recoveries. HPCL rose 2.39 per cent, Indian Oil gained 0.95 per cent, and Bharat Petroleum was up 0.99 per cent.
Bharti Airtel continued to be the top gainer on the Sensex (4.37 per cent), followed by GAIL (3.95 per cent), Tata Motors (4.33 per cent), L&T (3.42 pe cent), and HDFC (3.21 per cent).