Stock markets rally 1.4 pc as investors pin hopes on interest rate cut

Mumbai (Maharashtra) [India], June 3 (ANI): Equity benchmark indices ended at record closing highs on Monday as investors pinned hopes on a possible interest rate cut to bolster the economy.
A fall in global crude oil prices and a stronger rupee boosted market sentiment despite weak Q4 GDP data last week. The Nikkei India Manufacturing Purchasing Managers' Index (PMI) rose to 52.7 in May from 51.8 in April, showing the strongest growth in three months.
Consequently, the BSE S&P Sensex jumped 553 points or 1.4 per cent to close at 40,268 while the Nifty 50 gained 166 points to 12,089. At the National Stock Exchange, all sectoral indices were in the green with auto, metal and financial stocks leading the rally.
Hero MotorCorp was up 5.8 per cent after reporting 13.5 per cent higher sales figures during May. Low-cost airline SpiceJet spurted over 4 per cent after Indian Oil Corporation trimmed aviation turbine fuel price for the first time in the past five months and Brent slipped near its key level of 60 dollars a barrel.
Shares of Tata Steel BSL (earlier known as Bhushan Steel) rose 1.5 per cent after the company said it has completed the acquisition of Bhushan Energy in accordance with the approved resolution plan under the Insolvency and Bankruptcy Code 2016.
The other major gainers were Asian Paints, Bajaj Auto, IndusInd Bank, and Indiabulls Housing Finance. However, GAIL, ICICI Bank, Tech Mahindra, Bharti Infratel and NTPC lost marginally.
The most active stocks were Reliance Industries, Tata Consultancy Services, and HDFC.
Many economists and officials expect the new government to push long-pending reforms in the next parliamentary session beginning on June 17 after its landslide election victory led by Prime Minister Narendra Modi.
The Reserve Bank of India (RBI) is expected to reduce interest rates at its June 4 to 6 policy meeting, a move that will increase consumption levels and private investments.
Meanwhile, Asian share markets slipped following intensifying US-China trade tensions and Washington's new tariff threats against Mexico. Beijing implemented tariff hikes on Saturday and announced it will take action against 'unreliable' foreign companies.
Investors believe these developments could tip the global economy into a recession. Hong Kong opened flat on Monday while China and Korea eked out gains. (ANI)