Monsoon forecast cheers Indian equity markets on Wednesday

Mumbai: Key Indian stock market indices were trading significantly higher on Wednesday morning, cheered by the news a day earlier from official agencies that factory output was back on the growth path, retail inflation has fallen further and rains this monsoon season will be bountiful.

Investors were also bracing for a long weekend with trading holidays on Thursday and Friday.

The sensitive index (Sensex) of the BSE, which has closed at 25,145.59 points on Tuesday, opened on the next day at 25,358.42 points. Some 15 minutes after, the bellwether index of 30 shares was trading at 25,461.15 points, up 315.56 points or 1.25 percent.

At the National Stock Exchange, the story was no different. The broader 50-share Nifty which had ended on Tuesday at 7,708.95 points, opened at 7,777.15 points. Soon after, the index was ruling at 7,797 points, with a gain of 88.05 points, or 1.14 percent.

The previous two sessions also saw both indices end on a higher note. On Tuesday, while the Sensex was up 123.43 points or 0.49 percent, Nifty ended 37.55 points, or 0.49 percent, higher. On the previous day, the Sensex rose 348.32 points, or 1.41 percent, and the Nifty was up 116.20 points or 1.54 percent.

On Tuesday, predictions on monsoon came during the trading hours.

The India Meteorological Department (IMD) said that after two straight years of drought, India is likely to be showered with above-normal rains during the upcoming monsoon season, with a probability of more than 94 percent precipitation.

Then, after the closing bell, came the twin dose of positive news from the Central Statistics Office that India's factory output for February logged a growth of 2 percent after three straight months of decline, and annual retail inflation fell to 4.83 percent in March from 5.26 percent in February.

On Wednesday, most Asian-Pacific markets were also trading in the green, with sentiments buoyed by the rise in oil prices that had, in turn, helped US stocks to rise.

Australia's ASX 200, Japan's Nikkei, Taiwan's Taiex, Hong Kong's Hang Seng were all trading higher.

The markets in South Korea and Thailand were closed.

In an analysis ahead of the opening bell in India, Angel Broking said: "US stocks posted solid gains on Tuesday after initially showing lack of direction. The strength was primarily led by energy stocks which gained on reports of Saudi Arabia and Russia working toward an agreement to cut production."

The brokerage said the European stocks also rose and closed mostly higher on Tuesday at the end of a choppy session, helped by gains in energy and mining stocks, even as Indian shares ended on a strong note for the second consecutive session.