Mumbai, Jan. 24: Stocks leapt on the bourses with investors expecting the CRR cut to funnel more cash into the financial system ' and starting to see the first glimmer of hope that interest rates would ease by the end of this fiscal.
The Sensex topped the 17000 mark in intra-day trades but fell just a shade below the psychological level at the close, but still closed with an overnight gain of 244 points, or 1.46 per cent, at 16995.77.
All-round buying was seen in interest rate sensitive sectors such as capital goods and banking.
Market circles said few had anticipated a reduction in the cash reserve ratio at the start of trading today. Stocks vaulted on the announcement. The 50-share NSE Nifty regained the 5100 level, adding 81.10 points, and closed at 5127.35 points.
On the BSE, all the 13 sectoral indices closed with gains of up to 3.30 per cent. Capital goods, banking, metal, auto and realty led the gains.
Of the 30-share Sensex pack, 22 scrips ended with gains, while the others declined.
Among the major gainers were Larsen and Toubro (5.64 per cent), the State Bank of India (5.19 per cent), Hindalco (4.55 per cent), MandM (3.56 per cent), ICICI (3.30 per cent), Sterlite (3.11 per cent), Tata Power (2.53 per cent), Jindal Steel (2.26 per cent) and Reliance Industries Ltd (1.58 per cent).
Total market breadth on the BSE was positive with 1,592 stocks ending in the green and 1,206 finishing with losses. .
Market experts, however, caution that with the monetary policy event now out of the way, equities may correct and it could react to developments from either the Eurozone or within the country.
"The attention will now be on Europe, corporate results and the upcoming budget," an analyst said.
The gains at the stock market coupled to hopes of more inflows from foreign institutional investors worked in favour of the rupee, which crossed the 50-level mark for the first time in 10 weeks at the inter-bank forex markets.
However, the Indian currency ended flat at 50.10 against the dollar as dollar buying emerged again. Moreover, the recovery in dollar value overseas and month-end demand from oil refiners for the greenback limited the rupee's gains.
On the forex market, the rupee opened strong at 50.01 a dollar as the Euro appreciated against the dollar and built up on its gains after the central bank brought down CRR. It, thereafter, moved in a range of 49.92 and 50.13.
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