The Nifty rose 1.24 percent on Monday as investors bought shares in recent outperformers such as State Bank of India, allowing the broader index to post its best quarterly gain since January-March 2012.
The Nifty rose 13.36 per cent in the quarter concluded on Monday, the best performer in the Asia-Pacific, on a rally spurred by hopes the election of Narendra Modi as the country’s prime ministry last month would spur a period of economic reforms.
On Monday, the Nifty gained 1.37 per cent at 7,611.35 points, gaining 5.3 per cent this month. The benchmark BSE Sensex closed 1.25 per cent higher at 25,413.78 points. The index gained 4.9 per cent this month and 13.5 per cent in the April-June quarter.
An easing of oil prices and a higher rupee helped support the gains on Monday. Brent crude oil today eased 25 cents to 113.05 a barrel. Oil prices have come off recent highs as fighting in Iraq stayed away from the country’s south, where most of its oil is produced.
Analysts expect the undertone of Indian markets to remain positive ahead of Budget which will be tabled on July 10.
Sharekhan’s Devang Shah said Nifty could hit 7800-7850 in near term after breaking from its thin consolidation range. He expects banking stocks to lead the rally. His picks: Canara Bank and PNB. Nifty has support at 7,440, he added.
Banking stocks led the gains with Bank Nifty rising nearly 1.7 per cent to 15,241. Bank Nifty found support at 14900 levels and could hit 16,000, Mr. Shah added. PSU banks led the rally in banking stocks with gains particularly sharp in midcap stocks. Canara Bank, Bank of Maharashtra, Andhra Bank, Allahabad Bank and Syndicate Bank rose between 6-11 per cent. Among the large cap banking stocks, PNB, Bank of Baroda, ICIC Bank and SBI rose between 2-4 per cent. For the quarter, the Bank Nifty index rose over 19 per cent.