Sensex gains 595 points led by banking stocks, closes above 32,000

Analysts said the monthly expiry of derivatives contracts triggered a lot of short-covering in finance stocks
The benchmark indices extended their gains on Thursday on the back of continued buying interest in financial stocks amid supportive global cues. 

The Sensex closed at 32,201, up 595 points, or 1.8 per cent, while the Nifty gained 175 points, or 1.8 per cent, to end at 9,490. Both the indices are at their highest level since April 30 after gaining more than 5 per cent in the previous two sessions. 

The rally has been underpinned by sharp gains in banking stocks. The Bank Nifty index has rallied 9.9 per cent in the past two sessions.

Analysts said the monthly expiry of derivatives contracts triggered a lot of short-covering in finance stocks. 

 

 
"Initially, firm global cues triggered the momentum, which further strengthened due to short covering. All sectoral indices witnessed a healthy buying interest. Importantly, Nifty has managed to surpass its immediate and crucial hurdle at 9,450, so it may be heading towards 9,650-9,750 levels. Banking and financial stocks will continue to play a critical role," said Ajit Mishra, VP Research, Religare Broking.

Forecasts of normal monsoon also helped sentiment. Also, massive stimulus action from global central banks spurred risk taking. 
Going forward, analysts said investors are likely to keep a watch on GDP data which expected on Friday. On the global front, any news on US-China tussle will be on investors' radar.  All the Sensex components barring three ended the session with gains. L&T was the best-performing Sensex stock and rose 6.17 per cent.  All the BSE sectoral indices ended the sessions with gains. Capital Goods and auto stocks rose the most, and their gauges rose 5.1 per cent and 3.5 per cent, respectively. 


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