Markets turned euphoric following government's move to rein in ballooning current account deficit as well as shore up falling rupee with the benchmark CNX Nifty zooming by a hefty 87 points at the National Stock Exchange today.
In a bid to revive investor confidence and boost business sentiment, which has taken a hit due to the mounting trade gap, Finance Minister P Chidambaram yesterday announced a slew of measures to increase capital flow.
The worsening CAD, a key measure of trade, is putting intense pressure on the Indian currency. The trade gap touched a record high of 4.8 per cent of GDP in 2012-13.
Besides, the government today hiked customs duty on gold, silver and platinum to 10 per cent in a bid to curb the surging imports and burgeoning CAD.
After recouping initial losses, the key benchmark staged a strong rally on across-the-board buying and maintained the buoyancy throughout the session. The 50-share index briefly touched the key 5,700 level in late afternoon.
Financial, technology, FMCG, healthcare, auto, energy and capital goods stocked witnessed heavy buying.
Other Asian markets too rallied, scaling multi-month highs, buoyed by stronger-than-expected industrial output data from China amid expectations of more aggressive monetary easing by the Bank of Japan.
The Nifty surged by a whopping 86.90 points, or 1.55 per cent, to end at 5,699.30. It touched a high of 5,704.75 and a low of 5,578.90 in early trade.
DLF, Ranbaxy, Axis Bank, JP Associates, IDFC, Tata Motors, Reliance Infra, NTPC, HDFC Bank and HDFC were among the dominant gainers from the Nifty bunch.
Key draggers included Hindalco, Coal India, Ambuja Cement, Cairn, ACC, Jindal Steel and ITC.
Turnover in the cash segment jumped to Rs 11,553.54 crore from Rs 11,145.78 crore yesterday. A total of 6,537.19 lakh shares changed hands in 61,07,135 trades. The market capitalisation stood at Rs 60,79,018 crore.
