 "Markets snap four-session losing streak")
The Indian market on Wednesday gained over a per cent after declining for four sessions, buoyed by positive global cues. Key policy announcements also boosted investor sentiment. Aviation companies' stock rose sharply after the Cabinet cleared the new aviation policy. Shares of State Bank of India (SBI) and its associates rallied after government approved their merger.
The benchmark BSE Sensex gained 330.63 points, or 1.25 per cent, to end at 26,726.34, while the National Stock Exchange’s Nifty 50 claimed the 8,200-mark to end at 8,206.6, up 97.75 points, or 1.21 per cent. Most global markets also gained on Wednesday in anticipation that the US Federal Reserve's will postpone interest rate hike. The mood, however, remained cautious ahead of the referendum in the UK.
“Several domestic factors drove the up move despite global volatility, concerns around the Fed meeting and Brexit speculation. Positive noise around GST (Goods and Services Tax), Cabinet decisions on SBI merger and civil aviation policy drove the rally,” said Gautam Duggad, head of research, Motilal Oswal Securities.
"Progress of monsoon will be a key factor for markets to sustain the upward momentum," Duggad added.
SBI was the biggest gainer among Sensex components, gaining 3.9 per cent on hopes that the merger will create long-term synergies. Meanwhile, shares of its subsidiaries State Bank of Mysore, State Bank of Travancore and State Bank of Bikaner Jaipur each got locked in 20 per cent upper circuit.
Meanwhile, shares of InterGlobe Aviation and SpiceJet gained two per cent and 3.5 per cent, respectively, following the new aviation policy.
“The market rallied today after four consecutive sessions of downturn, tracking the positive global markets and development over GST. Global markets are witnessing a rebound ahead of the Fed outcome which concludes today, with expectation for no rate hike. Positive signs over GST consensus are adding optimism on the domestic front,” said Vinod Nair, head of research, Geojit BNP Paribas Financial Services.
Other major gainers on the Sensex included NTPC, which gained 3.9 per cent and Larsen & Toubro which added 3.4 per cent.
