The Indian market closed at the day’s high after a volatile session of trade.
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Stocks saw a fall in an immediate reaction to RBI's 25 basis point rate hike, but stabilised later to close with major gains.
The late surge helped the market snap a three-day losing streak with the Sensex gaining 276 points to 35,179 and the Nifty surging 91 points to 10,685.
In the broader markets, the Nifty Midcap index climbed 258 points to 18,453 and the Nifty Bank index ended 117 points higher at 26,368.
Gains were seen across the sectors, with all the major leading indices closing the session in the green. Infosys, ITC, SBI, Reliance and HDFC were the top Nifty gainers.
The RBI's Monetary Policy Committee on Wednesday raised the repo rate by 25 basis points to 6.25%. The policy stance, however, was kept neutral despite a rate hike, which came for the first time since January 2014. GDP growth for FY19 was also kept unchanged at 7.4%.
In the futures market, 11,000 Call option shed 3.5 lakh shares in the open interest with premium moving 21% higher. And, amongst Put options, 10,600 Call added 8.6 lakh shares in the open interest with premium slipping 36%. Nifty June Futures closed with a premium of 5 points against a premium of 3 points of Tuesday.
On the global front, Asian stocks closed higher with major markets in the region gaining ground even as trade anxieties lingered in the background. The Nikkei 225 edged higher by 0.4% to close at 22,626 as energy-related names recovered slightly after the last session's decline. The broader Topix rose 0.1%. The Shanghai composite finished flat at 3,116 and the Shenzhen composite at 1,779.
In Australia, the S&P/ASX 200 added 0.5% to end at 6,025 points, buoyed by gains in resource plays and oil producers.
Mining majors Rio Tinto and BHP gained 2.5% and 2% respectively, while the country's "Big Four" banks closed lower across the board.
First Published: IST