Mumbai: The equity markets snapped their two-day loosing streak with the benchmark Sensex scaling above the psychological 26,000-level mark as a recovery in global crude oil prices and decent numbers reported by index heavyweight Maruti Suzuki lifted investor sentiments.
After opening the day on a negative note, the Sensex rallied higher gaining 328.37 points or 1.28 per cent to end the day at 26,007.30. The broader Nifty soared 107.60 points or 1.37 per cent to end the day at 7,962.62.
The shares of Maruti Suzuki surged 3.62 per cent on the Bombay Stock Exchange (BSE) after the company repor-ted a better than expected financial results in terms of revenue and margins growth despite posting an 11.73 per cent drop in net profit for the quarter ended March 2016.
According to the provisional data released by stock exchanges, foreign portfolio investors (FPI) bought shares worth Rs 512.22 crore. “The markets remained subdued for the last few trading sessions amidst fears about further correction in commodity prices. However, investor sentiments received a major boost after commodities including oil staged a mild recovery on Tuesday. This triggered short covering in the derivative segments ahead of the expiry of April series,” said Uday Narayan Dubey, vice- president, equity and wealth, Value Plus.
According to him, the fourth quarter results declared by large cap companies have surprised the markets. “The fourth quarter results were expected to remain subdued. However, few of the large cap companies have managed to better market expectations. PSU Banks and companies linked to commodities are yet to announce their quarterly performance. If their numbers are impressive, the markets could see further upside in coming days,” said Mr Dubey adding that the Nifty is facing stiff resistance at 8,000 – 8,050 levels.
On Tuesday, the broader markets remained positive with 1,584 stocks traded on BSE ending the day higher as compared to 994 stocks that declined. While the shares of Tata Steel gained 3.12 per cent, Cipla and BHEL rallied 2.75 per cent and 2.66 per cent respectively.
Shreyash Devalkar, fund manager, equities at BNP Paribas Mutual Fund pointed out that reports about a scheduled meeting between union finance minister and foreign rating agencies in May-June to discuss India’s outlook and ratings also buoyed investor sentiments. Global markets witnessed mixed sentiments, as investors remained little cautious.
