In a turnaround of fortunes, the stock market benchmark Sensex on Monday leaped by 568 points — its biggest single-day gain in over a year — on heavy buying by domestic investors in recently-hammered banking stocks, while the rupee also recovered to near 68-level.
The rally helped the Sensex and the Nifty recapture their 23,000 and 7,100-point levels, respectively.
In sync with equities, the rupee firmed up by 16 paise, to close at 68.07 against the dollar.
Gold, however, lost some of its sheen and dropped by up to Rs 705 per 10 grams.
Market mood changed for the better after Asia rebounded from recent weakness as fears over global economic slowdown eased and crude prices rallied. China’s central bank fixed the yuan higher as the nation returned from a week-long holiday.
On the macro front, WPI inflation for January came in at (-)0.9 per cent as against (-)0.73 per cent a month earlier.
The 30-share BSE Sensex settled the day higher by 568 points, or 2.47 per cent, at 23,554.12, its biggest rise since January 15, 2015, when the Reserve Bank went for a surprise 25-basis point rate cut, the first of four such reductions last year.
The 50-share NSE Nifty too surged 182 points, or 2.61 per cent, to 7,162.95.
Both indices had taken a severe beating and posted their worst weekly performance since July 2009, with the Sensex tumbling 1,631 points and Nifty down 508.15 points.
The rally mostly came on the back of visible signs of life in global stocks after last week’s huge sell-off and domestic institutional investors (DIIs) upping their buying momentum.
DIIs turned net buyers as they bought shares worth nearly Rs 2,000 crore while foreign portfolio investors (FPIs) offloaded shares worth Rs 1,300 crore, provisional data showed.
Moreover, covering up by speculators who had been creating short positions in the past several sessions buoyed sentiment.
In the process, total investor wealth of BSE-listed firms went up by over Rs 2.52 lakh crore to Rs 88,62,680 crore.
The biggest lender, SBI rebounded 7.94 per cent to Rs 167.25 on value-buying. Bank of Baroda zoomed over 22 per cent despite the lender recording the highest-ever quarterly loss.
All BSE sectors led by metal, capital goods and realty climbed up to 8.79 per cent, reflecting the buying spree.
In step with the overall trend, broader market BSE mid-cap rose 3.47 per cent while BSE small-cap edged up by 3.35 per cent.
Globally, most Asian markets closed higher by up to 7.16 per cent and European indices were trading firm, rising up 2.93 per cent, tracking Friday’s gains in the US market.
Gold was on edge, in line with the global cues, as rising shares meant diminished safe-haven appeal and domestic jewellers lay low.
In Kolkata, gold suffered by most falling Rs 705 to Rs 29,095 per 10 grams, while in Mumbai, the precious metal plunged Rs 695 to Rs 28,565. In Chennai, it lost Rs 475 at Rs 28,885 and Rs 100 at Rs 28,950 in the national capital.
Globally, in London, gold was trading 2.33 per cent down at USD 1,209 an ounce and silver slumped 2.95 per cent to USD 15.29.