Govt's Rs 9 lakh cr boost lifts Sensex to record 33,042 pts

The 30-share Sensex surged 435.16 points, or 1.33 per cent -- its biggest single session gain since May 25 when it had surged 448.39 points -- to close at a new peak of 33,042.50.

The broader 50-share Nifty finished at its fresh lifetime high of 10,295.35, up by 87.65 points, or 0.86 per cent.

Banking and infra counters led the charge after the government on Tuesday announced various measures to spur the economy, including a Rs 2.11 lakh crore recapitalisation plan for PSU banks and a massive Rs 6.92 lakh crore road building programme.

Banking behemoth SBI zoomed 27.58 per cent to emerge as the biggest gainer in the Sensex pack, while private peers ICICI Bank and Axis Bank soared up to 14.69 per cent.

Other prominent gainers in the state-run banking space were PNB, Canara Bank, Bank of Baroda, Bank of India, Bank of Maharashtra, Allahabad Bank, IDBI Bank and Syndicate Bank, rising by up to 46.20 per cent.

Major road builders such as Ashoka Buildcon, Sadbhav Infrastructure Projects and J Kumar Infraprojects also gained up to 8.71 per cent.

"Government's recapitalisation plan sparked astonishingly steep gains in PSBs, while short covering ahead of F&O expiry also added momentum.

"Giddy levels though saw profit booking in sectors other than banks, as investors continued to mix and match the earnings and valuations with more key earnings still to play out," said Anand James, Chief Market Strategist, Geojit Financial Services. After a gap up opening, the Sensex crossed the 33,000- mark for the first time to scale an all-time high of 33,117.33 in early trade on the back of run-up in PSU banks and heavy short-covering ahead of Thursday's October month expiry in the derivatives segment.

Despite profit-booking at record levels, it finished at a new peak of 33,042.50, up 435.16 points, or 1.33 per cent. It smashed its previous record closing of 32,633.64 reached on October 16. The gauge has gained 224.41 points in the previous two straight sessions.

The broader Nifty also hit a record intra-day high of 10,340.55 during the session, before finally concluding at 10,295.35, up 87.65 points, or 0.86 per cent.

It bettered its previous record closing of 10,234.45 reached on October 17.

Firmness in Asian stocks and unabated buying by domestic institutional investors also provided key support.

New Delhi: Reserve Bank Governor Urjit Patel on Wednesday said the Rs 2.11 lakh crore bank recapitalisation plan is a 'monumental step forward' in safeguarding India's economic future and a comprehensive policy would be put in place to address the challenges faced by the sector.

Welcoming the government's decision, Patel in a statement said that a well-capitalised banking system is a pre-requisite for stable economic growth.

"Economic history has shown us repeatedly that it is only healthy banks that lend to healthy firms and borrowers, creating a virtuous cycle of investment and job creation.

The Government of India's decisive package to restore the health of the Indian banking system is in the view of the Reserve Bank of India, a monumental step forward in safeguarding the country's economic future," he said.

Non-performing assets (NPAs) of banks have more than doubled to Rs 7.33 lakh crore in June 2017 from Rs 2.75 lakh crore in March 2015.

Mumbai: Brushing aside initial volatility, the rupee made a strong comeback by recovering 18 paise against the US dollar to end at a fresh one-week high of 64.89 on late selling of the greenback by exporters and corporates. Forex market witnessed a sudden revival in sentiment towards the tail-end session following recapitalisation plan to bolster NPA-hit public sector banks. he rupee opened on a weak note at 65.14 against Tuesday's close of 65.07 at the Interbank Foreign Exchange (Forex) market on the back of heavy dollar demand and drifted further to 65.20.