Short-covering buoys equity markets, Sensex gains 568 points
Short-covering, coupled with value buying and positive global indices buoyed the Indian equity markets on Monday.
Mumbai: Short-covering, coupled with value buying and positive global indices buoyed the Indian equity markets on Monday.
Consequently, a barometer index of the Indian equity markets provisionally closed the day's trade up 568 points.
The gains at the bellwether indices of the Indian equity markets came a week after, they had plunged by more than 6.50 percent each. The massive corrections made prices attractive and triggered value buying.
Initially, both indices opened on a positive note, following a major rise in the Japanese barometer index and healthy gains recorded at the US markets on last Friday.
Besides, a rise in crude oil prices which climbed around the $30 a barrel mark (one barrel is equal to 159 litres) led investors to chase stock prices higher.
In addition, a better-than-expected annual inflation rate and a stable rupee supported the equity markets rally.
Moreover, investors' confidence was restored after Finance Minister Arun Jaitley made comments on the upcoming budgetary announcements and expected banking sector reforms.
Market participants are hopeful that the central government may increase expenditure, announce tax concessions and pave the way to reduce the NPAs (non-performing assets) levels of the banking sector.
Consequently, the barometer 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE) rose by 568 points or 2.47 percent.
Similarly, the wider 50-scrip Nifty of the National Stock Exchange (NSE) ended with healthy gains. It closed higher by 182 points or 2.61 percent at 7,162.95 points.
The S&P BSE Sensex, which opened at 23,223.43 points, provisionally closed at 23,554.12 points (3.30 p.m.) -- up 568 points or 2.47 percent from the previous day's close at 22,986.12 points.
During the intra-day trade, the Sensex touched a high of 23,7622.64 points and a low of 23,197.67 points.
The BSE market breadth favoured the bulls -- with 1,985 advances and only 673 declines.