Auto, financial sectors lead the rally

The equity benchmarks rose for the fifth consecutive session on Wednesday with the 50-share Nifty closing above the psychological 11,000 mark for the first time in 2019.

Gains in select index heavyweights led by rate-sensitive sectors such as auto and finance on expectations of a rate cut by the Reserve Bank of India (RBI) on Thursday led to the rally in the benchmarks even as the broader market sentiment remained weak.

The 30-share Sensex gained nearly 1% or 358.42 points to close at 36,975.23. In the last five consecutive sessions, the index has gained a total of nearly 1,400 points.

Meanwhile, the Nifty ended the day at 11,062.45, up 128.10 points or 1.17%.

“Since last few days, we have been mentioning the possibility of Nifty surpassing 11,000 and it is a reality now. As far as levels are concerned, a fresh leg of the rally is unfolded and we expect Nifty to immediately hasten towards 11,200,” said Sameet Chavan, chief analyst, Angel Broking.

The broader market breadth, however, was weak with nearly 1,600 stocks in the red as against 1,008 gainers.

“So far the rally in the Indian markets has been fuelled by a select few large caps and wider participation of stocks is required if this rally is to sustain in the coming months,” said Hemang Jani, Head - Advisory, BNP Paribas.

The three-day RBI Monetary Policy Committee (MPC) meeting began on Tuesday to decide on key rates with the outcome scheduled to be announced on Thursday.

Market participants expect the RBI to change its policy stance to ‘neutral’ from the current ‘calibrated tightening’.

“With lot of hopes built in this time for a rate cut from the new governor, this may provide impetus to the rate sensitive universe,” added Mr. Chavan.

Among the Sensex pack, stocks like Bajaj Finance, ICICI Bank, Bajaj Auto, Mahindra & Mahindra and Tata Motors were among the top gainers.