The benchmark Sensex closed above the 40,000-mark for the first time ever on Monday as investors bought shares anticipating a rate cut on Thursday on the back of weak growth data.

The 30-share Sensex gained 553.42 points or 1.39% to close at a record 40,267.62. Interestingly, the benchmark had crossed the 40,000 mark for the first time during intra-day trades on May 23, when the election results were announced.The broader Nifty closed above the 12,000-mark at 12,088.55, up 165.75 points or 1.39%.

“Market has hit new all-time high on expectation that the Reserve Bank of India, in the forthcoming monetary policy on June 6, might cut rate by 50 basis points,” said Naveen Kulkarni, Head - Research, Reliance Securities.

Last week, government data showed that the gross domestic product grew at 5.8% in the January-March 2019 quarter, dragging down the full-year growth to a five-year low of 6.8%.

If the central bank on Thursday cuts key rates, it would be the third such straight cut in a row. The two earlier reviews saw RBI cutting the repo rate by 25 basis points on each occasion.

Incidentally, the gains in the Indian market on Monday came amid a weak trend in most other markets, weighed in by the impact of the ongoing trade tensions between the U.S. and China.

“Indian markets went against the trend seen in most other markets,” said Deepak Jasani, Head - Retail Research, HDFC Securities. “Indian markets were buoyed by the falling crude oil prices and the inflows from FPIs, while traders kept building positions ahead of the RBI’s policy meet and next month’s Budget.”

The market breadth, however, was negative with nearly 1,500 stocks losing ground as against 1,170 gainers. Many mid-cap and small-cap stocks have been registering selling pressures in the last few days as investors look to book profits after the recent gains.