India’s benchmark indices on Tuesday closed at new highs, boosted by the government’s Rs 2.11-lakh-crore plan for bank recapitalisation. The Bombay Stock Exchange Sensex gained 435.16 points to close at 33,042.50, while the National Stock Exchange Nifty surged 87.65 points to finish at 10,295.35.

Public sector banks led the rally in banking stocks, with Nifty PSU Bank index rising 29.63%. The State Bank of India was the star performer on both Sensex and Nifty. On the BSE, the bank’s stock rose over 26%. On the NSE, it gained more than 27%. ICICI Bank was the second biggest gainer on both indices, gaining over 14% on each.

The other top gainers on the Sensex were Larsen & Toubro, Axis Bank and Bharti Airtel. At the Nifty, other stocks which rallied the most were UltraTech Cement, Larsen & Toubro and Axis Bank.

But private sector lenders performed poorly on both indices. Shares Kotak Mahindra lost over 5%, followed by HDFC Bank (-3.79%), and HDFC (-2.48%) at the Sensex. The other top losers on the BSE were Lupin and Sun Pharma.

At the Nifty, the top loser was Yes Bank (-5.96%), followed by Bajaj Finance, Kotak Mahindra, Indiabulls Housing Finance and IndusInd Bank.

Other Asian markets had a mixed day. The Hong Kong Hang Seng gained 147.92 points, while Japan’s Nikkei 225 lost 97.55 points. The Taiwan TSEC 50 Index and the Shanghai SE Composite Index closed almost flat.

The Indian rupee rose one paise against the United States dollar to trade at 65.09 at 3.50 pm.

Centre’s package to boost economy

Of the Rs 2.11 lakh crore, the Centre aims to provide Rs 18,139 crore directly through its budget, Rs 1.35 lakh crore through selling bonds, and the rest by selling government stake in the market. This would support credit growth and job creation, the Finance Ministry said on Tuesday. The government also said it would take other “definite steps” to help public sector banks play a major role in the financial system.