Mumbai: Expectations of a cut in key interest rates by the RBI following a steep fall in headline inflation fuelled a robust rally in the market.
The benchmark S&P BSE Sensex zoomed by a healthy 774 points, its biggest weekly gain in the current calender year, and reclaimed the 19,000-level after one-month.
The 30-share index ended at 19,016.46 in the shortened week. The Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) were closed on April 19 on account of "Ramnavami".
A fall in gold and global oil prices also boosted the market sentiment as it eased worries of high current account deficit (CAD) and fiscal deficit, two key challenges being faced by Asia's third-largest economy.
Interest rate-related counters from banking, realty and auto segments were in keen demand.
Buying was so strong that 11 out of 13 sectoral indices closed with gains between 0.84 percent and 7.50 percent. Only BSE-IT and BSE-Teck finished in the red on rise in rupee value against dollar, which could affect companies' bottomline in the rupee term.
Inflation based on the Wholesale Price Index (WPI) dipped to over three-year low of 5.96 percent in March from 6.84 percent in February, reinforcing rate cut hopes by RBI after retail inflation also showed declining trend last week.
RBI will announce its annual monetary policy on May 3.
The BSE barometer, on first trading day of the week, dropped to a low of 18,144.22 on profit-booking due to sluggish economic indicators from China, a major importer of copper and other metals.
Later, the Sensex swiftly bounced back due to a fall in inflation and scaled a high of 19,058.80 before concluding the week at 19,016.46, displaying a rise of 773.90 points, or 4.24 percent.
The key BSE index had vaulted by 833.33 points, or 4.50 percent, in the last week of November 2012.
The wide-based CNX Nifty of the NSE also flared up by 254.55 points, or 4.60 percent, to settle at 5,783.10.
Renewed capital inflows from foreign institutional investors (FIIs) also boosted the market sentiment. FIIs have invested a net of Rs 1,484.77 crore during the week under review, including the provisional figure of April 18.
The rally was broad-based as 24 of the 30 Sensex scrips ended higher, while the rest finished lower.
Major gainers were SBI (10.18 percent), M&M (9.55 percent), Bharti Airtel (9.55 percent), ONGC (8.44 percent), Larsen (8.33 percent), Maruti (8.26 percent), ITC (7.57 percent), ICICI Bank (7.44 percent), HDFC (6.71 percent), Sun Pharma (5.27 percent), Gail India (5.18 percent), HDFC Bank (4.57 percent) and Bajaj Auto (4.14 percent).
However, IT giants TCS dropped by 4.04 percent and Wipro by 3.82 percent.
Among the major indices, the S&P BSE-Bankex rose by 7.50 percent followed by S&P BSE-CG 5.80 percent, S&P BSE-Realty 5.26 percent, S&P BSE-FMCG 5.26 percent, S&P BSE-Auto 5.02 percent, S&P BSE-PSU 4.70 percent and S&P BSE-Oil&Gas 3.43 percent.
However, S&P BSE-IT dropped by 2.33 percent and S&P BSE-IPO by 1.58 percent.
The total turnover at BSE and NSE declined to Rs 8,242.21 crore and Rs 46,997.76 crore, respectively, against the previous week's level of Rs 8,560.94 crore and Rs 47,705.31 crore.