Benchmark indices showed smart recovery in last couple of hours of trade and ended volatile session on a positive note on Tuesday, driven by global cues. Banking & financials, auto and metals stocks helped the Nifty close above 10,800 levels.
The 30-share BSE Sensex recovered more than 200 points from day’s low to close 130.77 points higher at 35,980.93 while the 50-share NSE Nifty gained 30.40 points at 10,802.20.
Overall the market has been rangebound for last few sessions and investors turned cautious ahead of corporate earnings season which will be kicked off later this week by IndusInd Bank, Infosys and TCS, experts said, adding globally the trade meeting between US and China will be closely watched.
“We continue to remain cautiously optimistic on the Indian markets in near term. The focus of investors would shift to Q3FY19 earnings season and domestic marco data (IIP, CPI & WPI), which are likely to dictate the trend of the market in the coming sessions,” Jayant Manglik, President, Religare Broking told Moneycontrol.
Further, market participants would closely monitor the progress of trade talks between US-China, behaviour of crude oil prices and fluctuation in currency as it would further induce volatility in the markets, he said.
Manglik advises investors to stay focused on selective blue chip companies while traders should strictly hedge their leveraged positions.
The broader indices closed mixed with balanced market breadth. The BSE Midcap index fell 0.16 percent while Smallcap gained 0.17 percent.
On the sectoral front, Nifty PSU Bank gained the most, rising 2.77 percent on improving NPA resolution along with capital infusion and depressed valuation.
Pharma index climbed 1.5 percent while Bank, Auto, Financial Service and Metal indices gained 0.4-0.8 percent.
ICICI Bank (up 3.4 percent), SBI (3 percent), Axis Bank (2.1 percent), ITC (0.92 percent), Sun Pharma (4 percent), Tata Motors (2.62 percent) and Yes Bank (2.8 percent) were leading positive contributors to the Nifty’s gains.
HDFC Bank, HDFC, Kotak Mahindra Bank, Zee Entertainment and HUL were top losers among Nifty50 stocks. Top IT firms TCS and Infosys were down by 0.2 percent ahead of December quarter earnings.
Bandhan Bank and Gruh Finance continued to fall sharply, down 5 percent and 16 percent respectively after the board members approved the amalgamation of Gruh Finance into Bandhan Bank through a share swap deal.
Tata Elxsi was down 0.6 percent after company’s Q3 profit dropped 20 percent sequentially while IndusInd Bank gained 1.2 percent ahead of December quarter earnings which are expected to be strong.
Bharat Dynamics rallied 6 percent after signing a contract worth of Rs 760 crore with the Indian Army.
On the global front, European stocks traded slightly higher as investors monitor the trade talks between China and the US. France’s CAC, Germany’s DAX and Britain’s FTSE were up 0.4-0.9 percent at the time of writing this article.
Asian stocks ended mixed with Japan’s Nikkei rising 0.8 percent while China’s Shanghai Composite fell 0.3 percent.