Mumbai June 6 (IANS) The Reserve Bank s "neutral" stance on a future rate hike trajectory along with its reform measures for the realty bond and banking sectors pushed the key indices of the Indian equity market higher on Wednesday.
According to analysts investors risk taking appetite was also enhanced on the back of positive global markets and a strengthened rupee.
Index-wise the S&P BSE 30-scrip Sensitive Index (Sensex) closed higher by 275.67 points or 0.79 per cent.
Similarly the wider 50-scrip Nifty of the National Stock Exchange (NSE) also settled in the positive territory. It gained 91.50 points or 0.86 per cent to close at 10 684.65 points.
The BSE Sensex which opened at 34 932.49 points closed at 35 178.88 points up 275.67 points or 0.79 per cent from the previous day s close at 34 903.21 points.
The Sensex touched a high of 35 230.54 points and a low of 34 896.37 points during the intra-day trade.
"RBI maintaining its neutral stance has been taken as a positive by investors. In addition other announcements regarding the realty bond market and banking sectors boosted sentiments " said Deepak Jasani Head of Retail Research at HDFC Securities.
"The negative impact of the rate hike was also curbed as market participants had already factored-in a possibility of a rate hike."
Geojit Financial Services Head of Research Vinod Nair said: "Market rallied sensing from the proactive decision given by RBI 25 basis points hike removing the uncertainty regarding the future hike."
"Investors have already factored the risk of higher oil price and inflation in the policy outcome. We can expect some respite to the equity and bond market in the near-term."
On Wednesday RBI raised its key interest rate for the first time since January 2015. It hiked the repo rate by 25 basis points to 6.25 per cent.
However RBI maintained its "neutral" stance on policy as it has done over four previous bi-monthly policy reviews when it held the repo or its short term lending rate for commercial banks at 6 per cent. This stance allows the RBI to move either way on rates.
On the currency front the Indian rupee strengthened against the US dollar to 66.92 from its previous close at 67.15 per greenback.
Investment-wise provisional data with exchanges showed that foreign institutional investors sold scrip worth Rs 81.40 crore while the domestic institutional investors bought stocks worth Rs 712.31 crore.
Sector-wise the S&P BSE consumer durables index gained by 462.47 points the automobile index was higher by 383.77 points and the capital goods index ended 254.64 points higher.
The major gainers on the Sensex were Bharti Airtel up 4.55 per cent at Rs 380.35; Tata Motors up 3.56 per cent at Rs 295.50; Sun Pharma up 3.21 per cent at Rs 488.85; State Bank of India up 2.43 per cent at Rs 269.90; and Tata Motors DVR up 2.07 per cent at Rs 174.90 per share.
The top losers were Asian Paints down 0.73 per cent at Rs 1 263.75; ONGC down 0.47 per cent at Rs 170.35; HDFC Bank down 0.07 per cent at Rs 2 059.15 and ICICI Bank down 0.04 per cent at Rs 283.80 per share.

--IANS rv/vm