The 30-share BSE index jumped 524 points or 0.88% to close at 59,8312. While, the broader NSE Nifty settled 154 points higher at 17,731.
In the sensex kitty, prominent gainers were Nestle India, ICICI Bank, L&T, SBI, HDFC, HDFC Bank and Dr Reddy’s, spurting as much as 2.92%.
Only two counters closed in the red — Hindustan Unilever and Kotak Mahindra Bank, shedding up to 3.05%.
Brokers said buying activity gathered momentum as investors opened their new books in the first session of Samvat 2079.
Domestic markets conduct a special one-hour Muhurat trading session on Diwali every year to mark the beginning of the traditional Hindu calendar year, called ‘Vikram Samvat’.
In the previous Samvat 2078, the sensex dipped 464.77 points, while the Nifty shed 252.90 points.
The BSE and NSE will be closed on Wednesday (October 26) on the occasion of ‘Diwali Balipratipada’.
What is muhurat trading
Samvat, also called Vikram Samvat, is the year according to one of the Hindu calendars that is followed mainly by the Gujarati trading community who dominate Dalal Street.
Every year BSE conducts a special trading session on the first day of the Samvat year, which also happens to be the Diwali day. This trading period is called the Muhurat trading session.
Worshipping account books and cash registers on this day is considered to be an auspicious practice by businessmen.
The session marks the beginning of a new Hindu calendar year — this year it will be Vikram Samvat 2079.
The Bombay Stock Exchange (BSE) has been organising this since 1957 whereas, the National Stock Exchange (NSE) started it in 1992.
When is it conducted
Muhurat trading session is held at the most auspicious hour of the day on Diwali. It is a popular belief that trades executed during this time brings prosperity and wealth throughout the year.
Before the start of the hour-long Muhurat session, every year BSE has a Lakshmi Puja at the exchange’s Convention Hall, usually attended by most brokers, their families, friends and other people.
Dalal Street veterans say that on this day, those who follow the Samvat year should always buy some shares, even if in small lots and should never sell any. With a large number of individual traders and traditional brokers resorting to only buying stocks while most of the institutions are closed for Diwali, the sensex usually shows an uptick during the Muhurat trading session.
How was Samvat 2078
The previous year was a pretty volatile one for the stock markets.
Samvat 2078 had started on a positive note but succumbed to global pressures resulting from the Russia-Ukraine war since February 2022.
In fact, Samvat 2078 performance was the worst in last 7 years even as investor wealth increased by over Rs 11 lakh crore.
The 0. 8% decline since last Diwali meant that the sensex slipped into the red for the first time since Samvat 2071 (calendar year 2015), when it had sunk 4%.
The muted performance in Samvat 2078 came after the sensex rallied 38% — a 12-year record — in the previous year. Even during Samvat 2076, when the pandemic broke out, the sensex had risen 11% despite extreme volatility. The Omicron variant was the first pain-point for investors. It was followed by the invasion of Ukraine by Russia in February, which wreaked havoc on global supply chains and pushed up energy & commodity prices.
The third blow came from the relentless rate hikes by the US Federal Reserves to counter soaring inflation, which led to flight of foreign institutional investors.
The ongoing economic slowdown in China, rate hikes in India and the sliding rupee have added to bearishness among investors.
(With inputs from agencies)