Sensex hits 7-mth high on stimulus, loan ruling hopes

TNN

Mumbai: With a 304-point gain, sensex closed at 39,879 points on Wednesday — an over seven-month high — as Reliance Industries,

IT

and financial

stocks

gained despite a last-minute sell-off in the US on Tuesday night.

The sensex has gained over 3,300 points or 9% since its recent closing low of 36,554 on September 24. These gains have come on the back of

stimulus

hopes in India and expectations of a favourable Supreme Court order on how bank customers will pay interest on loans for the six-month moratorium period.

In the last few weeks, software stocks have rallied on hopes that the worst phase for these companies in terms of business downturn due to the pandemic is over. The upturn was led by the industry leaders like TCS, Infosys and Wipro. Financial and banking stocks have rallied on expectations of a positive judgment from the apex court. Reliance has been notching up gains on the back of it offloading stakes in its retail arm, market players said.

On Wednesday, RIL, HDFC Bank, Infosys and HDFC contributed over 80% of the sensex’s gains. BSE data showed that on Wednesday, foreign funds were net buyers at Rs 1,094 crore while domestic funds were net sellers at Rs 1,129 crore. For Thursday, the buyback-related announcements by TCS and Wipro are expected to keep the sentiment positive. On the back of these announcements, Market players are expecting a similar decision by Infosys, which led to a 4% jump in its ADRs (American depositary receipts) on

Nasdaq

on Wednesday evening.