Indian shares rose on Monday, April 27, with the BSE Sensex rising more than 700 points tracking gains on the Asian stock markets after the central bank launched a special liquidity facility (SLF) for mutual funds. Healthy buying in banking, oil and gas, auto and finance stocks also supported the indices.

Bombay Stock Exchange
An Indian woman speaks on her phone while walking past a Bull sculpture outside the Bombay Stock Exchange (BSE) in Mumbai on February 6, 2018. Asian stocks plunged on February 6 after a record-breaking loss on Wall Street, extending a global rout as panicked investors fret over rising US borrowing costs and take profits after months of market euphoria.INDRANIL MUKHERJEE/AFP/Getty Images

At 10.22 am, Sensex was trading at 32,038.75 points, higher by 711.53 points or 2.27 per cent from the previous close of 31,327.22. It had opened at 31,659.04 and so far touched an intra-day high of 32,067.55 and a low of 31,651.58.

The Nifty50 on the National Stock Exchange was trading at 9,355.50, higher by 201.10 points or 2.20 per cent from its previous close.

RBI steps in to protect mutual funds

The Reserve Bank of India said it would open a special liquidity facility for mutual funds of 500 billion rupees ($6.56 billion) to ease liquidity strain, reassuring investors after a prominent fund house last week said it would wind down six credit funds due to a lack of liquidity.

"After Franklin Templeton, there was a fear that people will panic and withdraw money from other funds, so RBI is helping mutual funds with extra liquidity. It is trying to avoid contagion," said Gaurav Dua, head of capital market strategy at Sharekhan.

"This is helping stocks of mutual funds and banks with stakes in asset management companies."

Private-sector lender Kotak Mahindra Bank Ltd was the biggest mover, rising as much as 6.9% to a near four-week high.

Asset manager Nippon Life India Asset Management Ltd soared 12.7%, while HDFC Asset Management Company Ltd jumped 7.9%.

(With agency inputs)