Value buying propels markets; Sensex closes 171 points up (Fourth Lead)

Attractive valuations and bargain hunting propelled a barometer index of the Indian equities into closing on Wednesday with gains of 171 points or 0.67 percent.

The gains came a day after the barometer 30-scrip sensitive index (Sensex) of the S&P Bombay Stock Exchange (BSE) plunged 541 points or 2.07 percent at 25,651.84 points.

Weak European cues, dwindling rupee value coupled with anxiety over the upcoming derivatives expiry had on Tuesday eroded investors' confidence at the Indian equity markets.

The Indian markets again came under pressure during the initial trade on Wednesday, as weak Asian cues emanating out of a below-expected Chinese PMI (purchasing managers' index) data spooked investors.

The Asian markets fell after the release of the Chinese PMI data. Hong Kong's Hang Seng dropped by 2.26 percent, and China's Shanghai Composite Index tumbled by 1.69 percent. Japan's Nikkei index was closed today.

However, attractive valuations in banking, consumer durables and information technology (IT) sectors helped the Indian markets pare initial losses.

Furthermore, value buying was observed at the wider 50-scrip Nifty of the National Stock Exchange (NSE). It gained by 33.95 points or 0.43 percent at 7,845.95 points.

The S&P BSE Sensex, which opened at 25,526.53 points, provisionally closed at 25,822.99 points (at 3.30 p.m.) -- up 171.15 points or 0.67 percent from the previous day's close at 25,651.84 points.

The Sensex touched a high of 25,934.02 points and a low of 25,386.48 points in the intra-day trade.