Markets rebound on short covering, bankex rallies

Markets bounced back after posting losses for nine consecutive sessions as commodity prices plunged overnight and buying emerged in banking and auto shares.

Nifty opened in the green and touched a high of 5,552 in afternoon trades led by short covering as the markets were extremely oversold due to heavy selling seen in the past few sessions. Investors cheered falling crude prices as it could bring some respite to high prices which have been eating in companies operating margins. S&P CNX Nifty was up 85 points, at 5554 and the Sensex surged 298 points, at 5545

Navneet Daga, Derivative Analyst from KR Choksey securities said, that "the PCR (Put Call Ratio) had fallen to 0.91 levels, if the ratio falls below 1.0 it indicates that markets are oversold and Nifty index also fell from 5900 to 5400."

Daga added, a positive closing may take the markets to 5600, where it may consolidate.