Sensex, Nifty rebound from 6-week low; top 3 factors that fuelled the rally

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NEW DELHI: The domestic benchmark indices recovered from six-week lows as BSE Sensex gained as many as 352 points to 32,949.21 while Nifty50 ended the session at 10,166.70, up 123 points.

The smart rebound on Thursday came on the back of falling crude oil prices, low-level buying and revival in global cues.

Auto stocks led the rally with shares of Motherson Sumi, Maruti, Bajaj Auto, Bosch, Ashok Leyland, Apollo Tyres and TVs Motors gaining over 2 per cent each.

Metal and realty stocks added to gains as JSW Steel (up 4.05 per cent), SAIL (up 3.95 per cent), Jindal Steel (up 3.41 per cent), DLF (up 3.22 per cent) amd IndiaBulls Real Estate (up 3.18 per cent) rallied.

PSU Bank stocks too recovered from the previous session’s losses, and Nifty PSU bank index ended 1.25 per cent higher at 3,798.55.

“Buying support was broad based. All major sectoral indices closed in the green with financials leading the chart. Benchmark Bank Nifty was also up by 205 points with both PSU and private banks contributing well. This trend has to continue for at least tomorrow’s session to confirm positive momentum and to start making fresh positions,” said Rahul Agarwal, Director, Wealth Discovery.

Broader markets rallied with BSE Midcap index adding 231 points or 1.38 per cent to end at 16,893.61 and Smallcap index closing at 18,031.24, up 1.29 per cent or 230 points.

Defying the bullish spirit were index heavyweights such as TCS (down 0.52 per cent), Coal India (down 0.64 per cent), Cipla (down 0.50 per cent), Sun Pharma (down 0.26 per cent) and Wipro (down 0.34 per cent).

Meanwhile, shares of the D-Mart parent Avenue Supermarts climbed 1.94 per cent after 20 lakh shares traded in a block deal.

Here are top 3 factors that fuelled the rally on Dalal Street

Value buying: Some low-level buying supported benchmark equity indices on Thursday. In the past seven trading sessions benchmark BSE Sensex had lost over 1,000 points till December 6. Out of the seven trading session, six trading sessions remained in unfavorable for investors.

Firm global cues: Positive opening in European shares boosted investors’ sentiment in the domestic market. Asian major also settled higher on Thursday with Nikkei 225 index climbing over 1 per cent followed by Hang Seng 0.28 per cent.

Fall in crude oil prices: Sharp decline in crude oil prices in global commodities on Thursday also boosted investor sentiment in today’s trade. Crude prices in the international markets slipped nearly 3 per cent on Wednesday, its biggest daily decline in more than two months, after a sharp rise in US inventories of refined fuel suggested demand may be weakening.

In globally development, bitcoin continued its wild rally with the price of the cryptocurrency surging to $15,000 on Wednesday, pulling off a $3,000 surge in 24 hours.

In Europe, the STOXX 600 was up 0.1 per cent with tech stocks up 0.5 per cent but financials, industrials and healthcare shares also added points to the pan-European index, Reuters reported.

Source: Economic Times