Sensex rebounds 514 pts on firm global cues; IT, finance stocks spurt
Vinod Nair, Head of Research at Geojit Financial Services, said, Domestic indices staggered during the early trading session however positive trends in the global markets comforted Indian equities to rebound during the second half. Global stocks recovered from the fears sparked by troubles in the Chinese economy, ahead of the FOMC meeting that will start later in the day.
Equity indices clawed back lost ground on Tuesday, buoyed by a recovery in overseas markets as fears eased about the debt crisis at China's Evergrande group seeping into the global economy. Investors scooped up IT, finance, and metal stocks after the steep correction in the previous session, while a strengthening rupee also bolstered sentiment. After a choppy start, the 30-share BSE Sensex gained momentum in late-afternoon trade to close 514.34 points or 0.88 percent higher at 59,005.27. On similar lines, the broader NSE Nifty surged 165.10 points or 0.95 percent to 17,562. Bajaj Finance topped the Sensex gainers' list with a jump of 4.94 percent, followed by IndusInd Bank, ITC, Bajaj Finserv, Tata Steel, HCL Tech, Tech Mahindra, and Infosys.
''Domestic benchmark indices witnessed sharp recovery mainly led by a brisk rebound in defensive sectors like IT, pharma and FMCG,'' said Binod Modi, Head - Strategy at Reliance Securities. ''Today's recovery in equities shows that markets have discounted possible fallout from likely default of Chinese real estate giant Evergrande, while Thursday would be crucial as USD 83 million interest payment is due for Evergrande on the day,'' he added. Vinod Nair, Head of Research at Geojit Financial Services, said, ''Domestic indices staggered during the early trading session however positive trends in the global markets comforted Indian equities to rebound during the second half.'' ''Global stocks recovered from the fears sparked by troubles in the Chinese economy, ahead of the FOMC meeting that will start later in the day. All major sectors traded in the green zone while the auto sector remained under pressure due to rising input costs and the semiconductor shortage faced by the global auto industry,'' he added. Sectorally, BSE realty, metal, tech, IT, and basic material indices rallied as much as 2.93 percent, while utilities, power, auto, and banks were in the red. Broader BSE midcap and smallcap indices rose to 0.79 percent. Elsewhere in Asia, Hang Seng ended on a positive note, while Nikkei was in the red. Bourses in China and South Korea were closed for holidays.
Stock exchanges in Europe rallied over 1 percent in afternoon trade.
Meanwhile, international oil benchmark Brent crude rose 0.96 percent to USD 74.63 per barrel. The rupee on Tuesday rebounded by 13 paise to close at 73.61 against the US dollar. Foreign institutional investors were net buyers in the capital market on Monday as they purchased shares worth Rs 92.54 crore, as per exchange data.
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