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Published on 1/06/2020 4:07:43 PM | Source: Reuter

Sensex, Nifty surge over 2% as economy set to reopen

Posted in Stock Market| #Sensex #Stock Market #NSE #BSE #Nifty

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 Indian shares ended up over 2% on Monday in a broad-based rally, gaining for a fourth straight session, as optimism around imminent reopening of Asia's third largest economy after a months-long coronavirus lockdown boosted investor sentiment.

The NSE Nifty 50 index ended up 2.57% at 9,826.15, while the S&P BSE Sensex gained 2.71% at 33303.52. Both indexes surged over 3% earlier in the session, with the Nifty 50 hitting its highest since March 13, after rallying nearly 6% last week.

Financial stocks were primary drivers. The Nifty bank index closed up 3.43%, while the financial index rose 3.64%.

"Optimism around easing of restrictions, liquidity and hopes over measures from the government kept the markets positive," said A.K. Prabhakar, head of research at IDBI Capital in Mumbai.

"Now people feel that we will go back to the old normal. But, it is going to take some time due to the damage created (by the pandemic)," he added.

India permitted restaurants, malls and religious buildings to reopen from June 8, but extended lockdowns in high-risk zones until June 30 as a record high number of cases were detected nationwide on Saturday.

The reopening plan comes as data on Friday showed the domestic economy grew at 3.1% in the January-March quarter, its slowest pace in at least eight years.

Reliance Industries Ltd rose 3.9% and HDFC Bank Ltd gained 3.4%, and were the top boosts to the Nifty 50 index.

Shares of Bajaj Finance Ltd, the top gainer in the Nifty 50 index, ended 10.46% higher.

Real estate, hotel and retail stocks surged, with retailer Shopper's Stop ending up as much as 19.99%, its biggest one-day percentage gain since September 2017.

(Reporting by Nallur Sethuraman in Bengaluru; Editing by Shinjini Ganguli)