Markets ended the day registering record highs on the government’s mega stimulus push to the economy, with bank and infrastructure stocks leading the rally. The government on Tuesday announced a Rs 9 lakh crore package as part of its plans to construct highways and recapitalize banks.
The 30-share BSE Sensex was up 435.16 points or 1.33 per cent at 33,042.50 and the 50-share NSE Nifty rose 87.70 points or 0.86 per cent to 10,295.40.
Also Read: Govt’s Rs 6.9 lakh crore mega highways push: 10 things to know about the ambitious programme
Infra stocks gain
Driven by the government’s recent push to infrastructure sector, shares of top infra companies soared between 2 and 19 per cent intraday on Wednesday.
JKumar Infra gained the most at 19 percent, while stocks such as Larsen and Toubro, NCC, Dilip Buildcon, HCC and Sadbhav Engineering, among others rose 5-12 percent between them.
The government on Tuesday approved mega infrastructure projects worth Rs 6.92 lakh crore as part of a broad plan to create thousands of new jobs, raise income, boost investment and quicken growth in the broader economy.
Finance minister Arun Jaitley said that the government will launch an umbrella road building programme to remove bottlenecks in the sector. The program will cover 83,677 km of roads and will involve a capital expenditure of Rs 6.92 lakhs crore over the next 5 years.
Bank stocks zoom
Scrips of public sector banks rose exponentially on Wednesday, a day after the government announced a massive recapitilsation scheme.
Market observers pointed out that almost all the major PSBs like State Bank of India, Punjab National Bank and Bank of Baroda rose in the band of 20-40 per cent.
The S&P BSE bank -- BANKEX -- rose exponentially by 1,274.17 points or 4.71 per cent at 3.30 p.m.
"Today's up move in the key indices was based on yesterday evening's announcement on PSU bank recapitalisation. The large PSU bank stocks were expected to rise from 20-40 per cent depending on the individual bank's capital adequacy and NPA levels and most of those stocks have risen in this band only," Deepak Jasani, Head - Retail Research, HDFC Securities, told IANS.
"Even the maximum (trade) volume during the day so far (3.00 p.m.) of about Rs 49,000 crore on the NSE has been concentrated towards the banking counters and especially the large PSU bank counters."
Dhruv Desai, Director and Chief Operating Officer of Tradebulls, told IANS: "Almost all PSBs' stocks like those of SBI, BoB and PNB rose to touch their new 52-week highs during the intra-day trade."
"The rise in PSB stocks not only lifted the sectoral index but also the benchmark indices -- BSE Sensex and NSE Nifty -- to touch their all time highs during the intra-day trade."