Mumbai, Apr 6: Benchmark indices Sensex and Nifty staged a sharp rebound on Monday after falling in early trade following a correction in crude oil prices amid reports of ceasefire efforts in the ongoing West Asia war.
Intense buying in banking and IT stocks, and a strengthening rupee, supported investor sentiment, traders said.
In a volatile session, the 30-share BSE Sensex jumped 787.30 points, or 1.07 per cent, to settle at 74,106.85. During the day, it surged 887.91 points, or 1.21 per cent, to 74,207.46.
A total of 3,207 stocks advanced, while 1,147 declined and 190 remained unchanged on the BSE.
The 50-share NSE Nifty edged higher by 255.15 points, or 1.12 per cent, to end at 22,968.25.
“The recovery was primarily driven by reports of a potential ceasefire framework in the Middle East, which helped stabilise crude prices after the initial uptick and improved global risk sentiment,” Ajit Mishra, SVP, Research, Religare Broking Ltd, said.
From the 30-Sensex firms, Trent jumped the most by 7.89 per cent. Axis Bank, Titan, Larsen & Toubro, UltraTech Cement and Bajaj Finance were also among the major gainers.
On the other hand, Reliance Industries and Sun Pharma were the laggards.
Equity indices opened on a positive note, but faced profit booking in the first half, creating some intraday pressure. However, strong buying emerged in the second half, driving a sharp upside move and helping the benchmarks close at higher levels, said Hitesh Tailor, Technical Research Analyst at Choice Equity Broking Private Limited.
Sectorally, BSE PSU Bank surged 2.37 per cent, Consumer Durables (2.30 per cent), Private Banks index (2.15 per cent), Financial Services (2.12 per cent), BSE Top 10 Banks (2.07 per cent), Bankex (2.03 per cent) and utilities (1.94 per cent).
In contrast, energy and oil & gas were the laggards.
Consumer durables emerged as the top performer, supported by a strong demand outlook and interest in consumption-led themes. IT stocks also outperformed, with the Nifty IT index gaining on the back of rupee movements and defensive buying amid geopolitical uncertainty, as currency weakness supports export-oriented earnings.
“Domestic equities staged a strong rally as value buying gained traction across the board. Crude prices softened marginally on reports of ceasefire efforts, while encouraging provisional banking data supported interest in rate-sensitive segments,” Vinod Nair, Head of Research, Geojit Investments Limited, said.
However, overall risk appetite remains cautious due to persistent inflationary pressures and concerns over potential disruptions to global trade, he added.
Brent crude, the global oil benchmark, dropped 0.71 per cent to USD 108.3 per barrel.
The rupee gained 14 paise to close at 93.04 (provisional) against the US dollar on Monday.
In Asian markets, South Korea’s benchmark Kospi and Japan’s Nikkei 225 index ended higher. Markets were closed in Hong Kong and Shanghai for a holiday.
“The rebound was supported by reports of potential US-Iran ceasefire talks, which improved global risk sentiment and eased concerns over prolonged geopolitical tensions…The recovery was further aided by buying in IT and banking stocks, supportive global cues, appreciation in the rupee and a marginal decline in the India VIX (-0.2 per cent), which helped restore investor confidence after recent declines,” said Siddhartha Khemka – Head of Research, Wealth Management, Motilal Oswal Financial Services Ltd.
US and domestic equity markets were closed on Friday for Good Friday.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 9,931.13 crore on Thursday, according to exchange data. Domestic Institutional Investors (DIIs), however, bought stocks worth Rs 7,208.41 crore.
On Thursday, the 30-share BSE Sensex settled higher by 185.23 points, or 0.25 per cent, at 73,319.55. The Nifty closed at 22,713.10, up by 33.70 points, or 0.15 per cent. (PTI)
