Ignoring the Reserve Bank of India's (RBI) hard monetary stance, the BSE Sensex snapped its last 3-week losing streak by surging 359 points in the week due to all-round buying in view of resumption of capital inflows from foreign funds coupled with strong global cues.
Strong global cues due to statements by the German and Italian leaders, promising to do everything to protect the Eurozone, kept the market mood upbeat.
The RBI, in its first quarter monetary policy review, kept the key lending (repo) rate as well as cash reserve ratio (CRR) unchanged, while brought down the Statutory Liquidity Ratio (SLR) - the amount of deposits banks park in government bonds - by one per cent to 23 per cent, effective from August 11.
The BSE sensitive index opened higher at 16,919.14 and shot up further to 17,291.99 before ending the week at 17,197.93, a gain of 358.74 points, or 2.13 per cent.
It had lost by 681.93 points or 3.89 per cent in the last three weeks.
The NSE 50-share Nifty also shot up by 115.85 points or 2.27 per cent to 5,215.70. It had also fell by 217.10 points or 4.08 per cent during the last three weeks.
Buying was so strong that all indices closed with sharp gains between 0.08 per cent and 4.97 per cent with power, capital goods, realty, refinery, IT, FMCG and PSU counters taking the lead.