Financials boost Indian shares to best day in more than two weeks

Indian benchmarks settled at record closing highs on Tuesday, posting their best day in more than two weeks, lifted by a surge in heavyweight financial and bank stocks that have lagged sectoral peers so far this year.

The NSE Nifty 50 index added 0.8 per cent at 23721.3, while the S&P BSE Sensex advanced 0.9 per cent to 78053.5, as of 03:30 p.m. IST.

Financials gained roughly 2 per cent and banks rose 1.7 per cent. The two indexes were the top sectoral percentage gainers.

Private lender HDFC Bank, the heaviest stock on the benchmark Nifty, climbed 2.3 per cent. Peer ICICI Bank, whose market capitalisation crossed $100 billion, closed at a record high.

The outperformance in banking stocks is the primary boost to markets, which are lacking any major domestic trigger, said Ajit Mishra, senior vice president, research, at Religare Broking.

Analysts said that financials and banks will continue to see buying as they have been laggards this year, with their 9% rise well below the 24 per cent-43 per cent jump in metals, autos and realty stocks.

The benchmark Nifty 50 index has surged 8.4 per cent from the dip seen on June 4, in a post-election rally.

Among individual stocks, battery maker Amara Raja Energy and Mobility soared 19 per cent after inking a licensing deal with a unit of China-based Gotion High Tech.

Amara’s gains pushed domestically-focussed small-caps to close 0.14 per cent higher, after the gauge hit a record high earlier.