Mumbai: Indian benchmark indices made a stellar start to the week with Sensex and Nifty Monday logging new lifetime highs, boosted by FII buying in banking shares on hopes the RBI will hold rates in the upcoming policy review.
Hectic activity in select sectors ahead of the expiry of March derivative contracts on Thursday also helped domestic markets shrug off weak Chinese data, say traders.
The BSE Sensex resumed strong and gradually moved upwards to a new intra-day historic high of 22,074.34, before concluding at 22,055.48 -- gain of 300.16 points, or 1.38 percent, which is the biggest daily rise in two weeks.
It surpassed previous closing high of 21,934.83 recorded on March 10 and lifetime peak of 22,040.72 set on March 18.
Banking, refinery, metal, auto, power and capital goods counters attracted good buying interest while shares from pharma, consumer durable and IT segments saw profit-booking.
The broader 50-issue CNX Nifty of the NSE also flared up by 88.60 points, or 1.36 percent, to end at new record closing of 6,583.50. It registered lifetime peak of 6,591.50 on an intra-day basis as well.
Smart gains in ICICI Bank, HDFC Bank, RIL, HDFC, ITC, ONGC, TCS, HUL, L&T and GAIL mainly pushed the indices up.
"Banks stood out as clear outperformers. ONGC rallied 4 percent ahead of board meeting for announcement of interim dividend. Indian market has been strong in current year aided by robust FII flows and optimism related to general elections," said Sanjeev Zarbade, Vice President- Private Client Group Research, Kotak Securities.
Mirroring rise in stocks, Indian rupee hit 60.64 levels against the dollar, amid firming trend in global markets.
Jayant Manglik, President-retail distribution, Religare Securities said the surge in stocks was triggered by the buoyancy in banking counters as majority expects there would be no change in policy rates.
Asian shares ended higher, ignoring China HSBC flash manufacturing purchasing managers index (PMI) that fell to an eight-month low in March.
Indices in Hong Kong, China, Singapore, Japan, South Korea and Taiwan ended up in 0.33-1.91 percent range.
However, European markets were trading lower in early trades as indices in France, Germany and the UK eased in 0.43 percent to 0.81 percent range.
Commenting on Indian markets, Jignesh Chaudhary, Head of Research, Veracity Broking Services said: "Foreign Institutional Investors (FIIs) bought shares worth over Rs 17,000 crore till March 20 this month helping local equities hit record highs."
FIIs bought shares worth a net Rs 14.79 crore on last Saturday as per provisional data from the stock exchanges.
The 24 gainers in Sensex were led by Gail India (4.81 percent), ONGC (4.27 percent), ICICI Bank (3.71 percent), Coal India (2.81 percent), Hero Moto (2.60 percent), HDFC Bank (2.53 percent) and HDFC (2.17 percent).
Bajaj Auto (2.11 percent), RIL (1.83 percent), HUL (1.62 percent), Axis Bank (1.53 percent), Sesa Sterlite (1.37 percent), SBI (1.35 percent), Tata Power (1.32 percent), M&M (1.27 percent), TCS (1.26 percent) and ITC (1.11 percent) also notched up good gains.
The Sensex laggards include Dr Reddy's Lab (down 1.34 percent), Wipro (0.98 percent) and Cipla (0.80 percent).
Some experts advised caution as benchmark indices set new highs. "When the index is already trading at its all-time high levels, overall risk is high. However, investors may invest in specific stocks, particularly in correction or at breakout above crucial resistance levels," said Nidhi Saraswat, Senior Research Analyst, Bonanza Portfolio.
Among the S&P BSE sectoral indices, Bankex rose by 2.73 percent, followed by Oil&Gas (2.46 percent), Metal (0.97 percent), Auto (0.91 percent), Power (0.89 percent) and Capital Goods (0.83 percent).
However, the market breadth turned lower at 1,527 stocks ended in the red, 1276 finished with in the green while 158 ruled steady. The total market turnover rose to Rs 2,348.96 crore from Rs 449.09 crore on Saturday.