The Sensex and the Nifty surged over one per cent at the closing session on value-buying by funds and retail investors amid firm European cues.

The 30-share BSE index Sensex surged 242.32 points to end at 25,723.16 and the 50-share NSE index Nifty jumped 81.05 points to end at 7,683.65.

Sectoral indices

Barring healthcare, all other BSE sectoral indices ended in the green. Among them, consumer durables index gained the most by 3.2 per cent, followed by IT 2.08 per cent, TECK and power 1.73 per cent each, while healthcare index was down 0.1 per cent.

Infosys, Hindalco, SSLT, Wipro and Maruti were the major Sensex gainers, while the major losers were Sun Pharma, HDFC, Bharti Airtel, Cipla and HDFC Bank.

A report by SMC Investments and Advisors said: “The Federal Open Market Committee (FOMC) at its two-day meeting further reduced its purchases of Treasury bonds and mortgage-backed securities to $25 billion a month from $35 billion. Manufacturing activity in Japan expanded less than estimates in the month of July as domestic demand remained lower owing to sales tax increase. Manufacturing activity in China expanded at the fastest pace in last 27 months.

Back home, monsoon this season for India as a whole is estimated to be below 22 per cent of the long period average for the first two months of the monsoon season that starts in June and ends in September. Now the month of August is crucial as below normal rains would make drought a reality this year.

The Reserve Bank of India (RBI) in the monetary policy review meeting scheduled on 5th August is expected to keep status-quo on the interest rates.”

Investors keenly await the RBI monetary policy meeting scheduled for Tuesday to get further clues about futures policy rate moves.

Progress of the monsoon, earnings of companies and the actions of the foreign portfolio investors will be keenly watched this week.

Meanwhile, overseas investors have pumped in $6 billion into the Indian securities market in July — taking their overall net inflows since the beginning of 2014 to more than $26 billion, driven by an investment-friendly government at the Centre.

European stocks were little changed, trading near their lowest level in three months, as real estate companies dropped, offsetting easing concern about indebted lenders after Portugal bailed out Banco Espirito Santo SA. US index futures rose, while Asian shares were little changed.

The Stoxx Europe 600 Index advanced 0.1 per cent to 332.15 at 10:46 a.m. in London after rising as much as 0.3 per cent and falling as much as 0.3 per cent in early trade.

Futures on the Standard & Poor’s 500 Index expiring next month added 0.3 per cent, while the MSCI Asia Pacific Index increased less than 0.1 per cent.

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