The Nifty was just a tad from reclaiming the 5, 000 mark, the index touched a high of four, 998 in opening trades and was hovering around 4, 969, up 62 points and also the Sensex was at 16, 665, up 174 points.
Buying in blue chip stocks continued for that second straight session led by positive global cues and an end to political imbroglio within the weekend. The Reserve Bank of India during market hours on Monday unveiled new banking licenses that would allow the corporates to setup banks, which also fueled investor optimism.
Foreign Institutional Investors turned net buyers of Indian equities for the very first time after nine consecutive sessions of selling. FIIs bought shares worth Rs 366 crore in equities based on the provisional data available from the Bombay Stock Exchange.
Going forward, analysts said markets will require cues from the first quarter GDP data expected around noon today. Economists expect growth to slide below 8% as the Reserve Bank of India has hiked rates 11 times since March this past year.
Overnight, Wall Street indices posted gains, buoyed by upbeat personal-spending data as well as relief over Hurricane Irene not causing much damage. Asian markets were additionally trading higher on Tuesday as improved global sentiment encouraged buying. Hong Kong’s Suspend Seng Index added 2. 2%, China’s Shanghai Composite rose 1% and Japan’s Nikkei Share Average advanced 1. 6%. Automakers and technology shares were leading the increases in Asia.
Back in India banking shares were among the top sectoral gainers on expectations how the Reserve Bank of India may press the pause button as the Federal Reserve didn't introduce another stimulus that could have propped up commodity prices. Prominent gainers had been Federal Bank, Indusind Bank and Yes Bank, up almost 3% each.
IT shares were also leading increases for the second consecutive day. Infosys and TCS surged 2% each, then HCL Technologies and Financial Technologies, up 1. 5% each.
The midcap and also the smallcap indices were up over 1% and 0. 7% each.
ICICI Financial institution (up 2. 5%), Infosys (up 2%) and Reliance Industries (up 1. 6%) were the very best gainers on the Sensex, contributing almost 90 points to the index. ONGC (down 3. 1%) was the only stock which was trading at a negative balance.
Market breadth was extremely positive, 1, 302 stocks advance for 250 stocks which declined about the BSE.