The Indian markets rallied on Wednesday, tracking firm Asian and European cues after the Financial Times reported that Greek Prime Minister Alexis Tsipras was prepared to accept creditors' conditions for a bailout with only a handful of minor changes.
European finance ministers would meet again later today to discuss fresh proposals from Greece after it became the first developed country to fall into arrears on payments to the IMF. The ECB is also set to hold a Governing Council meeting to review the emergency funding assistance to Greek banks.
The benchmark index S&P BSE Sensex jumped 240.04 points or 0.86 percent to close at 28,020.87, its highest level in nearly 2-1/2 months.
The broader CNX Nifty index also gained 84.55 points or 1.01 percent to finish at 8,453.05, as signs of reviving growth in India's eight key infrastructure sectors and some improvement in the fiscal deficit numbers for the first two months of current fiscal helped offset data showing sluggish manufacturing growth.
Activity in India's manufacturing sector eased in June as output growth slowed on the back of a weaker rise in new order inflows, a private survey said. The Nikkei Manufacturing Purchasing Managers' Index, compiled by Markit, fell to 51.3 from 52.6 in May, although manufacturing output in the country expanded for the 20th successive month.
SBI rose nearly 2 percent and Bank of Baroda rallied 4 percent following reports the government is drawing up a comprehensive package to help PSU banks. Eicher Motors advanced 3.9 percent after CLSA maintained its buy rating on the stock.
BHEL gained 3.7 percent after successfully commissioning the 500 MW Kosti thermal power station in Sudan. Sasken Communication Technologies rose 1.8 percent after announcing a buyback program.
Low-cost carrier Spicejet climbed 3.5 percent as oil companies reduced jet fuel prices and InterGlobe Aviation Ltd, which operates the country's largest airline IndiGo, filed a draft red herring prospectus with market regulator SEBI to raise Rs 2,500 crore through its initial public offering.
Indraprastha Gas shares soared 9 percent after a favorable Supreme Court ruling. McNally Bharat Engineering was locked at the 20 percent upper circuit limit after it entered into an agreement with EMC and Williamson Magor Group to enable an additional equity investment in the company.
Shares of Cholamandalam Investment and Finance closed up 1.4 percent. The financial services company has joined hands with mobile app-based taxi aggregator, Ola, to offer car loans to its drivers.
On the global front, Asian stocks rose broadly for the second day in a row, even as Chinese stocks tumbled after a late-session selloff on concerns about hefty valuations for small-cap growth stocks in an environment of slowing economic growth.
The markets across Europe also surged higher as investors held out hope for a deal to keep Greece in the euro zone.
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