Markets in the US and the UK are likely to remain shut, observing a holiday and the bill for debt ceiling concern is expected to be voted on later this week. Domestic equity markets kicked off the week on a stronger note on Monday, thanks to the firm global cues and expectations of strong domestic economic growth. However, the gains were trimmed slightly as investors took some money off the table amid the optimism. Nifty Bank hit record highs amid the optimism, supported by some solutions for the US debt ceiling concerns. Markets in the US and UK are likely to remain shut, observing a holiday but the bill for debt concern is expected to be voted on later this week. For the day, the 30-share pack BSE Sensex jumped 344.69 points, or 0.55 per cent, to settle at 62,846.38. NSE's Nifty50 gained 114.10 points, or 0.62 per cent, to end the day at 18,613.45. Broader markets underperformed the headline peers but BSE midcap and smallcap indices settled in green. Fear gauge India VIX spiked more than 3 per cent to settle at 12.30-level.
"Nifty experienced a relatively stable trading session, after opening with an upside gap. However, it managed to break out of its consolidation phase, indicating a potential shift in market direction," said Rupak De, Senior Technical at LKP Securities.
"There was an increase in call writing activity at the 18,800 level, suggesting a resistance zone, while put writing was observed at the 18,600 level, indicating a potential support zone in the near term. Furthermore, the 18,500 level is expected to act as a significant support level for the index," he said.
Bank Nifty had been struggling to cross and sustain above 44,160 levels for a while. However, it opened with a strong gap in line with Nifty and was seen trading comfortably above 44,200 levels, said Gaurav Bissa, Vice President at InCred Equities.
"Though it gave up some gains towards the end, it managed to close firmly above the breakout area suggesting a move towards 45,000 is possible to be seen in the coming days. Since Bank Nifty has witnessed fresh breakouts, unlike Nifty, which has been trading considerably above the previous breakouts, one can expect strong outperformance by Bank Nifty going forward," he said.
On a sectoral front, only Nifty IT and Oil & Gas indices disappointed and settled lower. All other sectors posted gains on NSE. Nifty Consumer Durable index surged more than a per cent, while Nifty Financial Services and Metal indices added a per cent each. Nifty Auto, Nifty Bank, Realty Indices were the other top gainers.
On the Nifty50 index, Mahindra & Mahindra index gained more than 3 per cent after strong Q4 results. Titan Company also gained 3 per cent, while Coal India, Tata Steel, Ultratech Cement and Grasim Industries added 2 per cent, each. Hindalco, HDFC, State Bank of India and Adani Ports were among other top gainers for the day.
On the downside, ONGC tumbled another 3 per cent after disappointing Q4 results. Divis Laboratories, Power Grid and HCL Technologies shed more than a per cent each. Maruti Suzuki, Bharat Petroleum, Britannia and Adani Enterprises were other key laggards.
The domestic benchmarks experienced a strong rally and came close to its life-time highs, primarily driven by positive global cues and robust predictions of domestic economic growth, said Vinod Nair, Head of Research at Geojit Financial Services.
"An in-principle approval from US leaders for raising the US debt ceiling has generated optimism among global investors, who are now anticipating the next monetary plan of the Fed and economic data points. Meanwhile, the US PCE inflation rate that came in higher than anticipated raised the prospect of another rate hike by the Fed in its June meeting," he said.
A total of 3,811 shares were traded on BSE on Monday, of which 1,973 settled with gains. 1,658 stocks ended the session lower while 180 shares remained unchanged. A total of 283 shares hit their upper circuit, whereas 234 shares tested the lower circuit levels for the day.