Sensex ends 685 points higher, Nifty above 22,700; Trent up 13%

Benchmark indices extended their gains on Tuesday, with the Sensex rising nearly 700 points and the Nifty gaining close to 1%, as banking and financial stocks led the recovery. Trent surged over 12% after a strong business update, while easing crude oil prices and supportive global cues also lifted sentiment ahead of the Reserve Bank of India's policy decision on Wednesday.The Sensex ended at 73,067.81, up 685.34 points or 0.95%. The index opened at 72,508.05. The Nifty 50 closed at 22,776.10, gaining 219.35 points or 0.98%.The gains extended Monday's recovery, when the Sensex and Nifty had risen 0.66% and 0.60%, respectively, after both benchmarks suffered their eighth straight weekly decline.BANKS LEAD MARKET RECOVERYBanking and financial stocks were among the biggest contributors to Tuesday's gains after lenders reported positive quarterly business updates.The Nifty Financial Services 25/50 index rose 1.06%, while the private bank index gained 1.41%. Axis Bank jumped 2.01% and Kotak Mahindra Bank surged 3.59% after the lenders reported growth in advances and deposits.HDFC Bank also gained 0.74%, while ICICI Bank rose 0.65%. Reliance Industries advanced 2.77%, taking its two-session gain to 4.3%.The broader financial services indices also performed well, with the Nifty Financial Services ex-Bank index rising 0.97% and the Nifty MidSmall Financial Services index gaining 0.83%.Kranthi Bathini, director of equity strategy at Wealthmills Securities, said domestic markets had rebounded from oversold levels after last week's sharp decline, with bank quarterly updates showing continued credit and deposit growth.“The policy rate decision on Wednesday and quarterly earnings of Tata Consultancy Services on Thursday are the near-term triggers for the markets,” Bathini said.TRENT SURGES 12% AFTER Q2 UPDATETrent was the biggest Sensex gainer, with the stock jumping 12.78% to Rs 2,904.The sharp rally came after the Tata Group retail company projected a 23% year-on-year rise in standalone revenue for the September quarter. The strong business update triggered buying in the stock and lifted sentiment around the broader consumption space.Other consumer-facing stocks also gained. Hindustan Unilever rose 2.83%, while Asian Paints gained 2.03%.Dabur India and Godrej Consumer Products also rose after upbeat quarterly business updates.BROADER MARKET RALLYThe recovery was broad-based, with 14 of the 16 major sectoral indices ending higher.The Nifty 100 rose 1%, Nifty 200 gained 1.02% and Nifty 500 advanced 1.05%. The Nifty Midcap 50 rose 1.23%, Midcap 100 gained 1.08%, while the Nifty Smallcap 100 jumped 1.56%.Among sectors, chemicals rose 1.98%, pharma gained 1.66%, oil and gas advanced 1.58%, FMCG climbed 1.40%, private banks rose 1.41% and financial services gained 1.06%.Healthcare gained 1.05%, while consumer durables rose 0.75% and metals advanced 0.81%.IT was among the few sectors to end lower, with the Nifty IT index falling 0.59%. Realty declined 0.27% and PSU banks slipped 0.08%.CRUDE FALLS BELOW $100Crude oil prices provided another boost to Indian equities. Brent crude fell 1.65% to $98.66 per barrel, while WTI crude declined 1.83% to $87.79.Brent crude fell below the $100 mark amid increased Middle East oil exports and a G7 pledge to raise supplies. Lower crude prices are positive for India as they can ease pressure on inflation, the import bill and corporate margins.Asian and European stocks also advanced as global bond yields retreated from the multi-decade highs recorded in the previous session.RBI RATE DECISION IN FOCUSInvestors are now awaiting the RBI's monetary policy decision on Wednesday. The market is widely expecting a 25-basis-point rate hike, but the central bank's commentary on inflation, growth and its future policy stance will be closely watched.Bathini said the rate decision and guidance would be important near-term triggers for equities.“A 25-basis-point rate hike is already largely expected, and the commentary would be watched for signs of further tightening,” he said.A rate hike is also expected to support bank margins as floating lending rates rise, while strong deposit and credit growth remain positive for the financial sector.After the RBI policy decision, investors will turn their attention to the September-quarter earnings season. TCS is scheduled to report its quarterly results on Thursday.The earnings season will be important for assessing whether the improving domestic economic picture is translating into stronger corporate earnings after the market's recent correction.Tuesday's rally therefore gives some relief after eight consecutive weeks of declines, but investors will now look for confirmation from the RBI policy, corporate earnings, crude oil prices and foreign fund flows before assessing whether the rebound can continue.(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)- Ends

An engineer who swapped codes for headlines, Sonu Vivek is a product of IIMC Delhi with over three years of experience in the news room. Before joining India Today, he worked with ANI and TICE News. Born and raised in Bokaro, Sonu writes about personal finance, taxes, and stock markets. Basically, how you can make money and keep it. When he’s not simplifying budgets, he’s probably cheering for cooking or out playing some sport.