Sensex bounces back 333 points on smart recovery in rupee
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Mumbai: The benchmark S&P BSE Sensex on Wednesday surged 333 points as investors picked up beaten down shares and sentiment improved as the rupee made a smart pullback.
Gains were led by metal, healthcare and auto stocks. Realty shares fell after the RBI said banks should not make upfront disbursals of home loans, which should instead be linked to stages of construction.
The rupee, which fell below 68.50-levels, was trading near the 67-mark in afternoon deals. It ended at 67.07 versus the US dollar, up 56 paise or 0.83 per cent.
The Sensex opened higher and moved in a range of 18,188.43 to 18,612.60 before settling at 18,567.55, a rise of 332.89 points or 1.83 per cent. The broader Nifty on the National Stock Exchange shot up 106.65 points or 2 per cent to 5,448.10.
The SX40 index on the MCX-SX ended at 10,966.82, up 124.41 or 1.15 per cent. The markets were relieved that reports of missile firings on Tuesday turned out to be tests carried out jointly by Israel and the US.
On Tuesday, the Sensex fell 3.45 per cent to the lowest in a week after reports of missile firings indicated escalating tension in Syria. Hopes of fresh steps from the Reserve Bank of India, with Raghuram Rajan as the new Governor, also boosted sentiment.
"The Indian equity market managed to stage a strong pullback, once again tracking the currency markets," said Amar Ambani, head of research at India Infoline. "With a new RBI Governor, one does hope for a rate cut or, at least, one expects no further hikes as feared in the wake of the recent RBI measures to save the rupee."
ICICI Bank, TCS, Infosys and Reliance Industries were the top contributors to the gains in the Sensex. Metal stocks were in the limelight after a private survey showed that growth in China's services sector hit a five-month high.
Asian stocks ended mixed with indices in Hong Kong, Singapore, South Korea and Taiwan finishing lower while China's Shanghai Composite and Japan's Nikkei moved up.
European markets traded lower in the afternoon after US President Barack Obama secured more support in Congress for a miltary strike in Syria. In the local market, 29 Sensex shares advanced, led by BHEL (6.2 pc), Tata Motors (4.71 pc), Bharti Airtel (4.37 pc), ICICI Bank (4.34 pc) and Hindalco (3.97 pc).
Among the sectoral indices, S&P BSE-Metal rose 2.75 pc followed by S&P BSE-Healthcare 2.6 pc, S&P BSE-Auto 2.47 pc, S&P BSE-Teck 2.28 pc and S&P BSE-IT 2.15 pc.
The market breadth was positive as 1,364 stocks finished higher while 927 ended lower and 150 ruled steady. Total turnover was down at Rs 1,938.81 crore from Rs 2,183.96 crore on Tuesday. Foreign institutional investors sold a net Rs 716.16 crore of shares on Tuesday, as per provisional figures issued by the stock exchanges.
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