After a gap-up opening tracking gains in the overnight markets, the main Indian indices rose further after a favorable outcome from the much anticipated European Central Bank meet on Thursday.
ECB president Mario Draghi has launched an unlimited bond-buying programme to help calm the bond markets amid continued economic turmoil and to cut borrowing costs of highly indebted nations such as Spain and Italy.
Global risk-on trade has received a boost, albeit temporarily in the form of the ECB monetary stimulus.
US markets closed 2% higher on Thursday post the EBC meet.
Asian markets extended gains made on the back of Draghi’s comments amid reports that Chinese authorities have launched a slew of infrastructure projects to try and shore up growth in the world's second largest economy.
The Nikkei index in Japan ended higher by 2.2%, Hang Seng index in Hong Kong was up 3% and the ASX 200 index in Australia gained 0.3%.
European markets too extended gains with the FTSE up 0.2%, the CAC up 1.2% and the DAX gaining 0.9%.
Friday’s August jobs report in the US and next week’s Federal Open Market Committee meet are the other events markets will look forward to.
BSE Sensex: 17,683 up 2%
NSE Nifty: 5,342 up 2%
Although the broader market did clock in gains, they were not in line with their large-cap peers. The BSE Mid-Cap index rose 1.1% while the BSE Small-Cap index climbed 0.8%.
All the sectoral indices joined in the party as they closed higher by 0.7-3%. Capital Goods topped the list followed by Realty, Metals, Bankex, Auto, Consumer Durables, Oil&Gas, IT, Teck and Pharma. FMGC was the only index which gained under 1%.
DLF, Tata Steel, ICICI Bank, L&T, Tata Motors, JP Associates, Hindalco Inds, RIL, Bank of Baroda, Infosys, Sterlite Inds, Bajaj Auto, HUL, Sun Pharma, SBI, Maruti Suzuki, BHEL and Cipla were the top gainers on the Sensex and the Nifty.
There were no decliners on the Sensex while BPCL was the sole laggard on the Nifty. Ranbaxy Labs too ended flat on the index.
India Cements advanced 3.6% after Deutsche Bank upgraded the stock to ‘buy’ versus ‘hold’.
Jubilant Life Sciences rallied 9.2% to Rs.195.65 after its unit Jubilant DraxImage and Positron Corp signed a sourcing and supply accord Of Strontium-82 And Rubidium-82 generators.
Lloyds Steel Industries climbed 2.1% to Rs.11.17 after the company settled a loan restructuring dispute with ARCIL.
Mahindra Ugine Steel surged 15% to Rs.56.15 after it sold its 45% stake in unit Navyug Special Steel to Mitsui and Sanyo Special for Rs.2.18bn.
Motherson Sumi gained 0.9% to close at Rs.199.10 after BP Equities gave it a new ‘buy’ rating.
NMDC climbed 2.2% to Rs.187.20 after it formed a joint venture with Jharkhand State Mineral Development Corp to form a mining company where the former will hold 60%.
SREI Infrastructure closed flat after rising to Rs.23.60 on news that it had formed a venture with Arinma Holding to start operations in Sri Lanka.
Tata Motors advanced 4.4% to Rs.243.30 after it said that it would introduce 30 new models and variants in commercial vehicles this year.
Oil marketing companies, IOC, BPCL and HPCL closed 0.9-1.9% lower after the government said that it would not raise fuel prices for now. However, IOC closed tad up 0.1%