Sensex, Nifty settle above 2-month highs ahead of Trump's presser

In the broader markets, BSE Midcap index (up 1.4%) outperformed the headline indices

Extending gains for the second straight session, the benchmark indices on Wednesday settled above two-month highs tracking positive trade in global markets ahead of US President-elect Donald Trump's news conference later in the day that will give an initial insight into his policies.

The S&P BSE Sensex reclaimed its crucial 27,000 level to end 241 points higher at 27,140, while the broader Nifty50 closed at 8,381, up 92 points.

In the broader market, BSE Midcap index (up 1.4%) outperformed the headline indices. BSE Smallcap index gained 0.9%.

Market breadth depicted strength. There were nearly two gainers against every loser on the BSE. 1,727 shares rose and 1,079 shares declined. A total of 164 shares were unchanged.

"Nifty has made a decisive move today and crossed its crucial 8300 hurdle as well. Undoubtedly, things look favourable for further up move but any negative surprise from global front or from the earning season might derail the momentum. So, we suggest continuing with positive yet cautious stance while keeping a check on leveraged positions," said Jayant Manglik, President, Retail Distribution, Religare Securities.

With Trump taking centrestage later today, investors would welcome details on his plans to cut taxes and boost infrastructure spending, at the same time, they would expect clarity on his protectionist stance that he showcased during the election campaign.

Back home, investors are hopeful that Budget 2017 to be unveiled on February 1 would contain incentives for companies to help prop up an economy being hit by a ban on higher-value cash notes.

Sectors and stocks

Investors also await the key quarterly corporate results from software services firm TCS and Infosys. The IT giants will report their December quarter earnings on Thursday and Friday, respectively. Stocks of both firms ended flat today.  

Shares of metal companies were in focus with the Nifty Metal and S&P BSE Metal index hitting their respective 52-week highs after China's top steelmaking province said to further reduce production capacity.

BSE Metal settled the day 4.4% higher, led by gains in Jindal Steel (up 9.2%), Hindalco (up 6.4%), SAIL (up 6.3%), Nalco (up 6%), and Coal India (up 5.6%).

Banking stocks rallied with BSE Bankex gaining 2.4%. Indusind Bank (up 6.3%) was the top gainer on the index after the bank reported a healthy 29% year on year growth in net profit at Rs 751 crore for the third quarter ended December 31, 2016 (Q3FY17). The private sector lender had reported profit of Rs 581 crore in the same quarter last fiscal year.

Suzlon Energy rose 2.7% to Rs 15 after the company said it secured a 226.80 megawatt contract from an independent power producer. 

Shares of tyre manufacturers hogged limelight with the sector major MRF hitting a record high crossing Rs 55,000 mark on the BSE in intra-day trade.

The stock outperformed the market by surging 15% from its recent low of Rs 48,229 on December 26, as compared to 5% rise in the S&P BSE Sensex. It settled the day 4.5% higher at Rs 55,400. 

Global markets

European markets were trading mixed with the pan-European Stoxx 600 and CAC 40 down 0.1% each, while FTSE 100 added 0.2%. 

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.5%, essentially returning to where it was just before the November 8 US presidential election.Japan's Nikkei ticked up 0.3%, snapping three days of losses, while China's Shanghai Composite shed 0.8%. Hong Kong's Hang Seng index gained 0.8%.