Sensex ends 575 points higher, Nifty tops 7,900; ICICI Bank top gainer

Extending its gains for the second straight session on Wednesday, the S&P BSE Sensex jumped over 500 points, while the broader Nifty50 settled above its key 7,900-mark.

The headline indices logged their best gain in nearly three months, as companies with big rural sales such as Hindustan Unilever rose after private weather forecaster Skymet raised the outlook for the 2016 monsoon.

The 30-share index ended the day at 25,881, up 575.70 points, while broad-based 50-share index quoted 7,934, up 186.05 points at close.

Monsoon rains are expected to be 109 per cent above the long-term average, compared with its earlier estimate of 105 per cent, Skymet said on Tuesday, adding that the June monsoon rains were seen at 87 percent of long-period average.

 

Above-average monsoon plays a key role in boosting demand for an array of consumer goods, as 70 per cent of India's 1.3 billion people live in villages.

Global market sentiment was upbeat as investors cheered strong US new home sales data for April, which supported the view the economy may be strong enough for the Fed to raise interest rates as early as June.

"Global cues are definitely supporting and on top of that Skymet came out with the market commentary and raised its monsoon forecast, which is adding to the positive sentiment," said Vivek Mahajan, head of research, Aditya Birla Money.

ICICI Bank was the best performer on Sensex and settled 4.5 per cent higher on the Bombay Stock Exchange (BSE).

Agriculture-related stocks jumped on better monsoon expectations. Jain Irrigation Systems rose 1.53 per cent, while Insecticides (India) gained 3.65 per cent.

 

Hopes of revival in rural demand also boosted consumer goods firm Hindustan Unilever and two-wheeler maker Hero MotoCorp, which gained 1.63 percent and 1 per cent respectively.

Tech Mahindra jumped 10.29 per cent after the software services provider on Tuesday posted a 90 per cent surge in consolidated March-quarter profit, beating analysts' estimates, aided by higher other income and lower taxes.

Tata Power Co rose 1.95 per cent, gaining for the second straight session after the company on Monday posted stellar fourth-quarter results.

However, Cipla declined 4.97 per cent after India's fifth-largest drugmaker by sales on Tuesday reported a 69 per cent fall in its quarterly profit, well below analysts' forecasts.

A lowdown on markets today

12: 12 pm

Sensex at 25,740, up 435.25 points

Nifty at 7,889, up 140.85 points

09:20 am

Sensex at 25,608, up 302.73 points

Nifty at 7,844, up 95.25 points