BackSensex, Nifty rebound from one-year lows on short covering
Sensex, Nifty rise in choppy trade; Bank Nifty up 2.27%
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India’s stock markets rose on Tuesday, bouncing back from their lowest levels in a year as markets were seen as oversold, while sentiment was also helped after the government said it would make another attempt to pass the goods and services tax (GST).
India’s Parliamentary Affairs Minister Venkaiah Naidu told reporters the government might reconvene parliament to try to pass the GST after it failed to clear the upper house earlier this month.
Still, the session was very choppy with the NSE index falling as much as 1.8% at one point and rising as much as 1.5%, with sentiment still weak because of continued worries about a downturn in Chinese equity markets.
India’s volatility index, often called a fear gauge, hit its highest level since May 2014 and ended down 4.55% after surging 64.4% on Monday.
“When the market is oversold fresh buying will emerge and short covering will happen," Alex Mathews head of research at Geojit BNP Paribas said.
The broader Nifty rose 0.92% to 7,880.70 points, snapping a three-day losing streak. It earlier hit its lowest since 12 August, 2014.
The benchmark BSE Sensex ended 1.13% higher after earlier falling as much as 1.7% to its lowest since 8 August, 2014.
Bank stocks bounced back to prop the Bank Nifty sub index up 2.27%. ICICI Bank gained 5%, Axis Bank rose 4.3 % and Yes Bank advanced 8.1%.
All sectors ended in the green with the exception of export oriented sectors like IT stocks. Infosys fell 0.59%. Reuters
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