PSU bank package push Sensex,Nifty to record highs, SBI stock zooms

The 30-share BSE Sensex gained 387.96 points to open on 32,995.28 and the 50-share NSE Nifty gained 113.45 points to open on 10,321.15. Both the indices extended gains with Sensex breaching the 33,000-mark to touch the peak of 33,117.33 and Nifty scaling a fresh high of 10,340.55.

Evidently, PSU Banks were leading the rally in early trade with the Nifty PSU Bank sub-index jumping a whopping 22.76 per cent and the SBI stock being the largest gainer surging 24 per cent. ICICI Bank and Axis Bank were also making handsome gains. The surge in PSU bank stocks had started on Tuesday itself in anticipation of announcements by Finance Minister Arun Jaitley, with the PSU Bank sub-index gaining 3.79 per cent.

The government had on Tuesday announced an unprecedented Rs 2,11,000 crore plan for recapitalisation of the PSU banks in a bid to push growth and and create jobs. The package will be spread over two years, Finance Minister Arun Jaitley said.

While Rs 1,35,00 crore will be in the form of front-loaded recapitalisation bonds, the remaining Rs 76,000 crore will be in the form of budgetary support.

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