Sensex,Nifty rise most in 4 mths on Fed status-quo, China ties

Indian markets today logged their best daily gain since May 12 with Sensex jumping 481 points to 27,112.21 and Nifty soaring over 139 points to 8,114.75 bolstered by Fed's continued pledge to retain rates at low levels and rising optimism over trade ties with China.
Fuelled by foreign funds buying, all the 12 sectoral indices closed with gains between 0.58 per cent and 4.65 per cent. Realty, consumer durable, capital goods, auto, power and banking were the pacesetters in the surge.
The benchmark S&P BSE 30-share Sensex resumed lower and touched a low of 26,503.08. It, however, quickly rebounded in line with positive Asian trends to cross 27K-mark and hit high of 27,132.20, before settling at 1-1/2-week high of 27,112.21 -- a rise of 480.92 points or 1.81 per cent. Previously, it had zoomed 556.77 points or 2.42 per cent on May 12.

Similarly, the 50-share NSE Nifty regained 8,100 level and touched the day's high of 8,120.85 before settling 139.25 points higher at 8,114.75. Previously, it had zoomed 155.45 points on May 12.
In a statement, the US Federal Reserve Chairwoman Janet Yellen yesterday in its policy setting meeting promised to keep the interest rates near zero for a "considerable time after its bonds buying programme comes to an end in October, giving immediate relief to the emerging markets, including India as fears of immediate capital outflows have subsided.
Meanwhile, India today signed a 5-year trade and economic cooperation agreement with China with a view to improve the trade balance and obtain USD 20 billion Chinese investments.

"With US rate rise possibilities becoming a more distant reality, emerging economies including India can expect to keep their hot monies 'hot' for some more time," said Debopam Chaudhuri, Chief Economist, ZyFin Research.

Major Sensex gainers were Hero Motocorp (5.67 per cent), HDFC (3.73 per cent), Tata Motors (3.70 per cent), L&T (3.57 per cent), BHEL (3.51 per cent) and Bajaj Auto (3.47 percent).
Participants were truly excited by the prospects of huge investments by China in India's infrastructure, railway & manufacturing projects, according to Devang Mehta, Sr. VP & Head - Equity Advisory, Anand Rathi Financial Services.
Asian stocks gained in choppy trade after the US Federal Reserve after a two-day policy meet renewed a pledge to keep interest rates near zero for a considerable time and announced a further USD 10 billion reduction in monthly bond purchases.