Mumbai, Dec 26: The BSE benchmark Sensex on Wednesday jumped by 162 points, its best daily gain in a month, on good buying in capital goods, banking, power and oil & gas shares amid government announcing sops for exporters and hopes of more steps from RBI to ease the liquidity situation.
Brokers said investors increased positions ahead of the expiry of the December derivatives contracts tomorrow, while foreign capital inflows continued to rush in.
After resuming higher at 19,302.47, the Bombay Stock Exchange (BSE) 30-share index jumped to 19,468.40 as buying picked up in ICICI Bank, Bharti Airtel and Jindal Steel.
Among sops for exporters declared today, the government announced extension of 2 per cent interest subsidy till March 2014 and a pilot scheme of 2 per cent interest subsidy for project exports through Exim Bank.
Capital goods major L&T closed 2.19 per cent higher.
Helped by these positive sentiments, the Sensex closed at 19,417.46, a rise of 162.37 points or 0.84 per cent. This is its best single-day gain since 169 point-rise on November 30.
"Short covering was also witnessed ahead of Futures and Options (F&O) expiry day tomorrow, said Rakesh Goyal, Senior Vice President, Bonanza Portfolio."
Similarly, the NSE 50-share Nifty firmed up by 49.85 points or 85 per cent to 5,905.60.
Dealers said banks stocks, including SBI and HDFC Bank, gained on hopes the Reserve Bank of India (RBI) will pump funds to ease the liquidity situation. On December 28, RBI will push Rs 8,000 crore in the market by buying government securities.
Oil&gas shares including Reliance Industries and ONGC also inched up, helping the benchmark indices cement gains. Power-related scrips, including Tata Power, Bhel and NTPC, gained around 0.5-1.5 per cent range on good buying.
Asian stocks, barring Hong Kong which was closed today, ended higher on reports that US President Barack Obama plans to return early from his annual vacation to Hawali in order to take part in talks to avert the US budget issue.
"This boosted sentiment across the Asian markets," said Amar Ambani, Head of Research, IIFL.
Over $600 billion in tax increases and spending cuts are scheduled to start taking effect in January, 2013 unless the US Congress acts to avert them.
Key indices in China, Japan, Singapore and South Korea finished higher while Taiwan marginally eased. European stock markets were, however, closed today on account of Christmas.
Turning to the local market, 22 scrips of the 30-share Sensex pack ended higher while only eight finished lower.
Major gainers in the Sensex were Bharti Airtel (2.78 pc), ICICI Bank (2.38 pc), L&T (2.19 pc), Jindal Steel (2.03 pc), SBI (1.84 pc), Sun Pharma (1.69 pc), Bajaj Auto (1.67 pc), Tata Power (1.54 pc), ITC (1.06 pc) and Reliance Industries (0.98 pc).
However, Hindustan Unilever dropped by 1.40 per cent and Hero Motocorp by 0.81 per cent.
Among the sectoral indices, the BSE-Capital Goods index rose by 1.68 per cent, followed by the BSE-Bankex (1.36 pc), the BSE-Realty (1.22 pc), the BSE-Power (0.95 pc) and the BSE-Oil&Gas (0.80 pc).
Among losers, the BSE-IT eased by 0.17 per cent. The market breadth continued to remain firm as 1,523 shares finished higher while 1,416 counters ended lower.
The total turnover shot up to Rs 2,410.67 crore from the last Monday's close of Rs 1,646.65 crore.
Foreign institutional investors (FIIs) bought shares worth a net Rs 459.67 crore Monday as per provisional data from the stock exchanges.