Sensex edges up as caution reigns ahead of election outcome

The BSE Sensex edged up and the Nifty recovered slightly from the one-and-half month closing low hit in the prior session, as investors picked up some of the battered stocks but also continued to book profits ahead of crucial election results next week.

The Nifty is down 3.1 per cent since hitting a record high on April 25, as investors have reduced some of their positions ahead of the conclusion of elections.

Overseas investors sold index futures worth $85.25 million, turning sellers for the six out of the past seven sessions. Still, markets are overwhelmingly pricing in a victory by the opposition Bharatiya Janata Party, which is widely seen in markets as being more investor friendly.

The benchmark BSE Sensex gained 0.1 per cent to 22,344.04, while the broader Nifty ended 0.11 per cent higher at 6,659.85.

Shares got some support from Asian markets, which gained on dovish comments by the US Federal Reserve Chair Janet Yellen and upbeat Chinese trade data that suggested some signs of stabilisation in the world's second-largest economy.

Some recently battered shares rose, with Wipro Ltd gaining 0.96 per cent after losing 11.6 per cent since April 16 till Wednesday.

Metal stocks gained, with Hindalco Industries Ltd ending 1.2 per cent higher and Tata Steel Ltd gaining 0.53 per cent on hopes for revival in Chinese demand. However, investors also booked profits in other blue chips, with Reliance Industries Ltd falling 0.1 per cent after gaining 3.5 per cent in the previous three sessions. Meanwhile, Bharti Airtel ended 0.96 per cent lower. The stock fell for the eighth straight session after its earnings fell short of expectations of some investors.

Housing Development and Finance Corp Ltd fell 0.3 per cent, falling for the fourth straight session after its earnings disappointed some investors. The stock had declined 6.4 per cent in the past three sessions.