The BSE Sensex rose nearly 1 per cent on Tuesday to mark its highest close in two-and-a-half-years as consumer goods shares rallied to record highs with investors shifting to defensive stocks in an uncertain economic environment.
The BSE Sensex rose nearly 1 per cent on Tuesday to mark its highest close in two-and-a-half-years as consumer goods shares rallied to record highs with investors shifting to defensive stocks in an uncertain economic environment.
The Reserve Bank of India's (RBI) move to further curb gold imports was also seen as a positive, given that the prospective measures would help narrow the current account deficit (read story).
Gains also tracked higher global shares that rose towards five-year highs on Tuesday helped by China's plans for avoiding a hard landing in its slowing economy, while gold took a breather after its biggest one-day gain in more than a year.
However, analysts remain cautious after mixed earnings so far and on concerns about potentially stronger measures from the central bank to defend the rupee after its recent move to shore up short-term interest rates.
"Only few stocks are participating in the rally and with RBI tightening liquidity there is reluctance at these levels," said Deven Choksey, managing director at K R Choksey Securities.
The benchmark BSE Sensex rose 0.71 per cent, or 143.01 points, to end at 20,302.13, rising for a fifth consecutive session to mark its highest close since January 2011.
The broader Nifty rose 0.76 per cent, or 46 points, to end at 6,077.80.
Consumer goods companies continue to make record highs as funds opt for traditionally defensive stocks in an uncertain environment underscored by the rupee's volatility.
ITC Ltd gained 1.9 per cent after touching an all-time high of Rs 376.10, while Hindustan Unilever Ltd rose 3.1 per cent after hitting a record high of Rs 722.
Blue chip bank stocks gained on value buying after recent sharp falls, with a 6.4 per cent fall in NSE's banking sub-index last week.
ICICI Bank Ltd gained 1.6 per cent, while HDFC Bank Ltd ended 0.2 per cent higher.
Yes Bank Ltd rose 3.5 per cent a day before its quarterly results.
India's central bank moved to tighten gold imports while offering relief to domestic sellers by lifting restrictions on credit deals, which was seen a net positive for jewellery makers such as Titan Industries Ltd, which ended 5.9 per cent higher.
Tech Mahindra Ltd shares rose 0.6 per cent, taking gains so far in the month to 11.3 per cent, on cheap valuations relative to its peers even after the company became India's No. 5 IT services provider on its merger with Satyam Computer Services, analysts said.
The company completed the merger of its unit Satyam Computer Services with itself on June 25.
However, among stocks that fell, Ambuja Cements Ltd fell 0.5 per cent, adding to 4.7 per cent fall on Monday, a day ahead of its earnings results.
Ambuja Cements may miss profit consensus forecast for the April-June quarter, Thomson Reuters StarMine data showed.
Copyright: Thomson Reuters 2013
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