Sensex Rises Ahead Of RBI Policy

(RTTNews) - Indian shares rose notably on Monday ahead of the crucial bi-monthly monetary policy review at 11 hrs. on Tuesday. The Reserve Bank of India (RBI) is widely expected to maintain the status quo on the benchmark interest rate after an unexpected rate cut on March 4.

Economic reports were mixed, with activity in India's manufacturing sector accelerating in March, driven by stronger increases in new orders and output, while growth in services sector moderated in March when compared to the previous month.

Meanwhile, Finance Minister Arun Jaitley today said that legitimate tax demands from various governmental authorities should not be misconstrued as tax terrorism. Addressing industry representatives at the CII annual general meeting, Jaitley said that India will not be allowed to become a tax haven and that the government would provide a "reasonable compliance window" under the new black money law for persons with overseas funds to come clean.

The benchmark S&P BSE Sensex rose 244.32 points or 0.86 percent to 28,504.46, while the broader CNX Nifty index closed at 8,659.90, up 73.65 points or 0.86 percent from its previous close. Second-line stocks outperformed, with the mid-cap and small-cap indexes on the BSE closing up 1.1 percent and 1.4 percent, respectively.

Healthcare stocks gained ground, with Sun Pharma climbing 9 percent after completing its merger deal with Ranbaxy. Rival Dr Reddy's Laboratories jumped 4.6 percent on a brokerage upgrade and Cipla advanced 3.5 percent.

AstraZeneca Pharma climbed 8.6 percent. The company has entered into an agreement with AstraZeneca UK (AZ UK) pursuant to which the company would receive from AZ UK, the reimbursement of certain costs incurred for the marketing and promotion of the new launch products and support for the distribution of other products supplied by AZ UK.

NTPC gained 3 percent. The state-run power producer said it plans to almost double its capacity in 10 years through expansion and acquisitions. Kotak Mahindra Bank and ING Vysya Bank both rose over 2 percent after receiving RBI approval for their merger.

Adlabs Entertainment shares soared 18 percent on the first day of listing. Suzlon Energy rallied 4.4 percent after global brokerage Nomura initiated coverage on the stock with a buy rating. Bajaj Auto gained 0.7 percent on reporting a 22 percent decline in motorcycle sales for March.

KEC International rose 2.5 percent on bagging new orders worth Rs. 1,458 crore in India, Bangladesh, Oman, Malaysia and America.

Banks closed mixed, with SBI rising 0.2 percent after allotting shares to the government on a preferential basis, while ICICI Bank dropped 0.7 percent and HDFC Bank shed 0.3 percent.

HCL Technologies slid 0.7 percent, extending Wednesday's 4 percent loss, after the country's fourth-largest software services firm warned of currency impact in the March quarter due to cross currency fluctuations.

Sun TV Network plunged 10 percent after the Enforcement Directorate attached Rs.742.58 crore worth of assets in connection with its probe into the money-laundering case in the Aircel-Maxis deal.

Reliance Infrastructure tumbled 2.6 percent on a report the Delhi government has warned two power distribution companies to clear long-pending dues owed to the state or face disciplinary action.

On the global front, Asian stocks posted modest gains in holiday-thinned trade as most markets across the region and the major European markets remained closed for holidays. While Japanese shares retreated slightly due to a firmer yen, other markets managed to post modest gains amid speculation the U.S. Federal Reserve would not increase interest rates anytime soon.