India's Nifty 50, Sensex rally continues on financials push

BENGALURU, July 3 (Reuters) - Indias blue chip indexes Nifty 50 and Sensex rallied to fresh all-time highs on Monday, aided by broad gains led by financial services stocks amid improved global cues.

The Nifty (.NSEI) index rose as much as 0.74% to 19,331.15, while the S&P BSE Sensex (.BSESN) gained 0.79% to 65,232.64, as of 10:06 a.m. IST.

Financial services stocks (.NIFTYFIN) led gains on the Niftys sectoral indexes, rising over 1.5%. Index heavyweights HDFC (HDFC.NS) and HDFC Bank (HDBK.NS) gained 2% each, after approving July 1 as the effective date of the two financial behemoths $40 billion merger.

Bank (.NSEBANK) and auto (.NIFTYAUTO) indexes also hit record highs for the second consecutive session.

Eicher Motors (EICH.NS), which reported 26% Y/Y sales growth in June, and Mahindra & Mahindra (MAHM.NS) gained over 2% each and were among the top Nifty gainers.

Metal index (.NIFTYMET) gained over 1% and was among the top sectoral gainers.

The rally extended to broader markets as well, with smallcaps (.NIFSMCP100) gaining over 1.2% to an over 1-year high, while midcap index (.NIFMDCP100) scaled a new peak.

“Increased buying from foreign investors, a revival in monsoon and positive impact of HDFC merger are the key factors driving the rise in markets,\” said Prashanth Tapse, senior vice president (research) at Mehta Equities.

The rise in domestic equities comes on the back of rise in global peers, after data showed cooling of inflation in the U.S. and aided sentiment.

Among individual stocks, Ultratech Cement (ULTC.NS) rose over 2% and was among top Nifty gainers after reporting 20% growth in total consolidated sales volume in the June quarter.

Mazagon Dock Shipbuilders (MAZG.NS) jumped 7.67% to a record high after signing a contract worth 27.25 billion rupees with the Indian Navy.

($1 = 82.0355 Indian Rupees)