Sensex rallies on continued rate cut hopes

Jun 06, 2012 |

Reuters

mumbai

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The Sensex provisionally rose 2.5 percent, posting its biggest daily percentage gain since January 3, as hopes the RBI would cut interest rates sparked a rally in sectors that could most benefit such as autos and banks.

The Sensex rose 2.5 percent to end at a provisional 16,424.21 points, marking its third consecutive daily gain.

The Nifty rose 2.8 percent, to a provisional close of 4,997.10 points.

Banking shares, as measured by the NSE banking index, rose for a third consecutive day. HDFC Bank (HDBK.NS) gained 3.5 percent.

Autos, which would benefit from lower financing costs should interest rates be lowered, gained as well. Tata Motors (TAMO.NS) rose 5.4 percent, recovering from recent steep losses.

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