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Sensex rebounds 776.7 points on global strength


Mumbai: Indian stock indices jumped 1.4%, snapping a two-day losing run, led by gains in power, automobile and banking stocks. Analysts said gains in most global markets helped the Nifty end above the psychologically important level of 17,000.

These gains have come despite a spate of worries around the likelihood of a higher quantum of interest rate hikes by the US Federal Reserve, high inflation, elevated crude oil prices and surge in COVID cases leading to more lockdowns in China. Moreover, the Russia-Ukraine war which began on February 24 is still ongoing.

“Markets are currently gyrating on news on inflation, which results in market assuming faster-than-expected rate increases by central banks. including the US Fed, and news related to Covid-related lockdowns in parts of China, which results in markets assuming slower-than-expected rate increases by central banks on lower global economic activity and softer commodity prices,” said Sanjeev Prasad, co-head, Kotak Institutional Equities. “Markets are unlikely to perform well until valuations correct to more reasonable levels either through price and/or time correction and inflation comes down to more reasonable levels.”

Agencies

The Nifty ended up 246.85 points, or 1.46%, at 17,200.80 and the Sensex ended up 776.72 points, or 1.37%, at 57,356.61. Indices had fallen 2% in the last two sessions.

Power Grid Corporation of India, Titan Company and Mahindra & Mahindra gained about 4% each to end as the top gainers on the Sensex. Volatility levels eased, with India VIX ending down nearly 10% at 19.19.

“17,000-16,800 has acted as a support for the second time in last few days and as the 200-day exponential moving average coincides with the 50% retracement mark there, it has now become sacrosanct for the market,” said Ruchit Jain, lead research analyst at 5paisa.



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