Benchmark indices snap 2-day losing run; Sensex rises 776 points

The Indian benchmark indices rebounded on Tuesday amid positive global cues and buying in index heavyweights. The Sensex ended the session at 57,356, with a gain of 776 points, or 1.37 per cent. The Nifty50, on the other hand, finished at 17,201 points, with a gain of 247 points, or 1.46 per cent.

One of the factors that lifted sentiment was China’s pledge to boost monetary-policy support to bolster its Covid-19-hit economy. It came a day after the Chinese stocks had dropped to their lowest level in two years as Covid-triggered lockdowns there raised concerns about the global economic outlook. Overnight gains in US stocks on the back of strong earnings, also helped.

However, some called the rebound technical as the risks associated with lockdowns in China and hikes in interest rate by the US Federal Reserve persisted.

The People’s Bank of China pledged to support its economy through targeted financing of small businesses and a resolution to an ongoing crackdown on technology firms. The Chinese central bank further said it would promote the healthy and stable development of financial markets and provide a sound monetary and economic environment while reiterating that it would keep liquidity reasonably high.

The corporate earnings in the US are also providing some relief to investors. According to news reports, 80 per cent of the firms which reported results had beaten expectations.

“Strong buying interest from domestic investors and positive global trends resulted in a rebound. But volatility persists due to the lockdown in China, Russia-Ukraine war and rate hikes. However, dips are encouraging investors to accumulate quality stocks. In a range-bound market, it is advised to stick to sectors expected to be least impacted by inflation and rising bond yield, banking, IT, pharma and themes like green energy,” said Vinod Nair, head of research, Geojit Financial Services.

On Tuesday, overseas investors sold shares worth Rs 1,174 crore, while domestic institutions were buyers to the tune of Rs 1,644 crore.

“The market is likely to remain volatile in the broader trading range. We suggest investors remain focused on selective stocks in the market which are resilient on the back of strong quarterly results,” Siddhartha Khemka, head of retail research, Motilal Oswal, said.

Barring four, all the Sensex constituents ended the session with gains. Reliance Industries was up 3 per cent. Infosys gained 1.2 per cent.