On Tuesday, Finance Minister P. Chidamabram and the Securities and Exchange Board of India (SEBI) made efforts to relax investors who had been filled with tensions after the lawmakers rejected the much-awaited mega rescue package for bad mortgage debts in the U.S. Following the efforts made by Finance Minster and SEBI, the Bombay Stock Exchange 30-share sensitive index (Sensex) hiked up by 264 points, in spite of the challenging global trends.  

It is important to point out here that earlier in a trade when the $700 billion bailout package was rejected, the Sensex dropped by 442 points. But after the encouraging comments passed by Finance Minister and the SEBI Chairman, C. B. Bhave; Sensex moved up by 264.68 points to close at 12860.43. On Monday it closed at 12595.75. 

The top private sector lender ICICI Bank led the rally, and it became the biggest gainer among the Sensex scrips at 8.42 percent.  

There was also improvement in the National Stock Exchange index, Nifty, by 71.15 points, or 1.85 per cent, to 3921.20.  

Marketmen reported, “The Reserve Bank of India’s remarks that ICICI Bank had enough liquidity and the organization was well capitalized lifted the lender’s share. Banking major SBI rose 5.2 per cent and Axis Bank 7.67 per cent, pushing the sectoral index by 4.92 per cent.”

The Govt. dismissed all fears related to global financial crisis, and thus it too helped in rebounding of banking stocks by 5%. The Govt. also said that the Indian banks are well regulated. 

There was an increase in the shares of all major lenders that went up to the range of 5-8 per cent on the Bombay Stock Exchange. The SBI rose 4.32 per cent to close at Rs. 1,465.65.