The Sensex and the Nifty ended nearly 1 per cent higher on Thursday ending a six-session losing streak, as investors bought into beaten down shares even as the sentiment remained cautious ahead of the US Federal Reserve meeting next week.
The 30-share BSE index Sensex ended higher by 216.27 points or 0.86 per cent at 25,252.32 and the 50-share NSE index Nifty ended up by 70.8 points or 0.93 per cent at 7,683.30.
Both indices marked their biggest single-day percentage gain since November 19.
All BSE sectoral indices ended in the green. Among them, oil & gas index was up 1.89 per cent, followed by metal 1.65 per cent, realty 1.63 per cent and IT 1.31 per cent.
Top five Sensex gainers were Reliance (+3.71%), Hindalco (+2.71%), Tata Steel (+2.69%), NTPC (+2.5%) and HDFC (+2.3%), while the major losers were M&M (-1.66%), Lupin (-1.42%), Tata Motors (-1.18%), State Bank of India (-1.02%) and BHEL (-0.83%).
The tentative rebound from three-month lows this week also comes despite caution that a crucial tax reform would be cleared in the ongoing winter session of parliament, which ends on December 23.
Markets are expected to remain under pressure as foreign investors continue to sell Indian shares ahead of the US Federal Reserve’s December 16 meeting, where it is widely expected to raise interest rates.
Foreign investors have sold Rs. 4,651 crore ($696.49 million) worth of Indian stocks already in December, on track to surpass the Rs. 7,074 crore ($1.06 billion) sold in November.
“People are waiting; they are not creating huge positions. You have FIIs selling in the cash market and no positive domestic factors,” said Alex Mathews head of research at Geojit BNP Paribas.
A report by SMC Global said: “Asian stocks retreated in early trade on Thursday after a third day of losses on Wall Street, with less than a week to go until the US Federal Reserve decides on whether to raise interest rates. US markets finished in the red. The Dow Jones Industrial Average gave up triple-digit gains to close 76 points or 0.43 per cent lower at 17,492. Reflecting decreases in inventories of both durable and non-durable goods, the Commerce Department released a report on Wednesday showing an unexpected drop in US wholesale inventories in the month of October. The Commerce Department said wholesale inventories edged down by 0.1 per cent in October after rising by a downwardly revised 0.2 per cent in September. Economists had expected inventories to rise by 0.2 per cent compared to the 0.5 per cent increase originally reported for the previous month.”
European shares fell for a third straight session on Thursday, touching a two-month low, with retailers and tech firms under pressure even as commodity shares stabilised.
The pan-European FTSEurofirst 300 fell 0.3 per cent to 1,426.02, having touched its lowest level since mid-October. It is down 2.2 per cent this week.