The Sensex and the Nifty ended higher by nearly 0.7 per cent on Friday to mark their fourth consecutive week of gains, tracking global markets that rose after the European Central Bank (ECB) on Thursday signalled its readiness to inject more stimulus.
Indian markets that were shut on Thursday for a local holiday, took cues from Asia, where stocks extended a global rally on Friday after ECB President Mario Draghi said further rate cuts were being considered to stimulate the euro zone economy.
"Global markets are positive and ECB signal was positive, that's a key trigger," Alex Mathews, head of research at Geojit BNP Paribas said.
The 30-share BSE index Sensex ended higher by 183.15 points or 0.67 per cent at 27,470.81 and the 50-share NSE index Nifty ended up by 43.75 points or 0.53 per cent at 8,295.45.
Barring TECk, capital goods and auto, all other BSE sectoral indices ended in the green. Among them, banking index gained the most by 1.3 per cent, followed by FMCG 1.08 per cent, oil & gas 0.81 per cent and PSU 0.64 per cent. On the other hand, capital goods index was down 1.56 per cent, followed by auto 0.73 per cent and TECk 0.4 per cent.
Top five Sensex gainers were ITC (+2.81%), Axis Bank (+2.81%), GAIL (+2.11%), NTPC (+1.92%) and HDFC (+1.9%), while the major losers were Bharti Airtel (-3.42%), VEDL (-2.67%), L&T (-2.58%), Maruti (-2.05%) and Wipro (-1.68%).
Brokers comment
A report by SMC Global said: "Markets in Asia rallied, as investors welcomed the prospect of new stimulus measures in Europe, even as choppy trading in China's stock market threatened to keep a cap on its gains this week. Overnight, US stocks ended sharply higher Thursday, rallying on economic data, better-than-expected earnings and dovish comments from European Central Bank President Mario Draghi. A leading economic index for China spiked in September, the latest survey from Conference Board revealed, climbing 1.6 per cent. That follows the 1 per cent increase in August and the 0.9 per cent gain in July. The coincident index skidded 1.2 per cent after rising 0.7 per cent in August and 1.0 per cent in July."
Brokers said buying by foreign funds and retail investors tracking a firming trend in other Asian markets following overnight gains in Europe and the US after ECB chief signalled more stimulus before the end of the year buoyed the mood here.
Global markets
The prospect of yet more European Central Bank stimulus pushed world stocks to a two-month high, the euro to a two-month low and left investors paying for the privilege of owning short-term Italian and Spanish bonds.
European shares and bonds kept climbing on Friday after soaring on Thursday’s message from ECB chief Mario Draghi that the central bank was ready to adjust “the size, composition and duration’’ of its QE programme.
Asia extended a global stocks rally on Friday after the European Central Bank (ECB) signalled its readiness to inject more stimulus, helping the dollar scale a fresh two-month peak against the euro.
MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.6 per cent, on track for a modest weekly loss of about 0.1 per cent.