The BSE Sensex rose more than 350 points and the Nifty gained over 120 points on Thursday after the new Reserve Bank of India (RBI) chief Raghuram Rajan's comments on potential measures on Wednesday sparked hopes of more reforms aiding the economy and the currency.
In early trade, blue chip shares, especially banks, jumped with NSE bank index surging as much as 9.4 per cent after the new RBI governor announced a slew of measures to ease liquidity pressures on banks.
The broader Nifty was up 123 points to 5571.20 while the benchmark BSE Sensex was up 357 points to 18925.42 at 11.10 am.
The BSE benchmark Sensex soared by 488 points in opening trade on the back of a flurry of buying by funds and investors after RBI announced a slew of measures to revive the economy amid further recovery in the rupee.
Brokers said sentiments turned buoyant after new RBI Governor Raghuram Rajan yesterday came out with a slew of measures, including more trade settlement in rupees to rescue the battered financial markets.
Rajan also hinted at a shift in focus from inflation control, doggedly pursued by his predecessor, to boosting growth.
Brokers said further recovery in the rupee also supported the upside in equities. The rupee gained 138 paise against dollar to 65.69 in early trade.