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Stock Markets: Sensex closes higher, Nifty advances as inflation cools
Stocks were restrained in their movement on Wednesday ahead of the US Fed policy decision as the Sensex saw deep fluctuations,
Stocks were restrained in their movement on Wednesday ahead of the US Fed policy decision as the Sensex saw deep fluctuations, but managed to close with an upward bias taking cues from a falling inflation.
Banking stocks were in the spotlight as the RBI identified 12 major NPA accounts for insolvency proceedings, which will be referred to the National Company Law Tribunal (NCLT) under the Insolvency and Bankruptcy Code for quicker resolution.
Inflation based on the wholesale price index fell to a five-month low of 2.17 per cent in May, which boosted investors' expectations that the RBI may finally snip rates.
But they decided not to go the whole hog as they waited for the US Federal Reserve's policy move later in the day.
The 30-share Sensex resumed higher before settling at 31,155.91, a gain of 52.42 points, or 0.17 per cent. The gauge had gained 7.79 points in the previous session. The 50-share Nifty also ended higher by 11.25 points, or 0.12%, at 9,618.15.
In the meantime, the Cabinet paved the way for a proposal to introduce a Bill in Parliament for setting up a Resolution Corporation to deal with bankruptcy in banks, giving the stocks more good news. The Nifty PSU Bank index jumped by 0.92%.
"PSU banks exhibited a sharp surge taking cues from NPA resolution policies being formulated by RBI and bank consolidation plans from the central government," said Anand James, Chief Market Strategist, Geojit Financial Services.
RIL, L&T, Dr Reddy's and ICICI Bank ended higher.
In 30-share Sensex, RIL gained the most by 3.30 per cent on reports that its subsidiary Reliance Jio added 4 million new users to reach a consumer base of 112.55 million.
Sector-wise, the BSE realty rose by 1.50%
Capital goods, oil and gas and PSU counters provided support. The broader market outperformed the key indices, with the small-cap index rising 0.46 per cent and the mid-cap 0.01%.
Asia offered a mixed picture at the close. Key indices in Europe climbed. Foreign funds sold shares net Rs 312.40 crore while domestic investors bought Rs 304.58 crore yesterday, as per provisional figures.
