Mumbai: Stocks hit all the right notes after a long weekend and remained well above the baseline throughout the day as the Sensex on Tuesday jumped 214 points ahead of the outcome of the RBI monetary policy meet.
The Nifty too did not disappoint, which again settled above the crucial 9,800-mark.
Interest rate sensitive auto stocks in particular turned favourites on robust sales data for September amid expectations of favourable policy action from the central bank, analysts said. The decision of the six-member monetary policy committee (MPC) is due on Wednesday.
True to their form, domestic institutional investors (DIIs) carried on with buying, which saw the 30-share BSE barometer settle at 31,497.38, up 213.66 points, or 0.68 per cent.
It had advanced 123.91 points in the previous two sessions. A similar push helped the broader NSE Nifty take control of the 9,800 level again before ending up 70.90 points, or 0.72 per cent, at 9,859.50. The flagship index moved between 9,895.40 and 9,831.05.
A monthly PMI survey showed that the manufacturing activity expanded in September for the second month in a row, at 51.2, driven up by increase in output and new orders.
The MPC headed by RBI Governor Urjit Patel started the two-day deliberations on Tuesday. The industry and the government are calling for an interest rate cut to spur GDP growth, which fell to a 3-year low of 5.7 per cent in the June quarter.
The stock exchanges were shut on Monday for Gandhi Jayanti. Firm Asian leads and a higher opening of European markets reflecting a rally on Wall Street, where all three US indices scaled new records following strong economic data, made investors here bite the bait.
US manufacturing activity in September rose to its highest level in 13 years, a pointer to gradual revival of the global economy. The deadliest mass shooting in the US history in Las Vegas, however, brought in a sense of caution,traders said.