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Home >Markets >Stock Markets >Sensex today rebounds over 600 points. Key things to watch at current levels

Indian markets rebounded today after a two-day selloff with strong support from financial and IT stocks. Gains in global markets and expectations of strong earnings performance buoyed the sentiment. The blue-chip NSE Nifty 50 index rose 1.2% to 15,824 and the benchmark S&P BSE Sensex was up over 600 points to finish at 52,837.

IT major Wipro gained 2.8% after it announced its commitment to invest $1 billion in cloud capabilities over the next three years. IT stocks gained 1.8%. Consumer goods giant Hindustan Unilever posted a rise in quarterly profit, but came in just under analysts' expectations, dragging shares down 2.3%. Shares of Bajaj Finance and Bajaj FinServ surged about 4%.

"Global markets were higher today ahead of the European Central Bank meet for a second day as optimism about an economic recovery appeared to outweigh concerns over rising coronavirus cases and inflation. Nifty is on the cusp of the downgap area formed on July 19. If this downgap is filled and we move above 15883, then the path to further upmove opens up towards 15915-15962 band," said Deepak Jasani, Head of Retail Research, HDFC Securities.

The broader markets too posted strong gains with BSE midcap and smallcaps rising 1%.

Indian markets are currently dancing to the global tunes and earnings announcements are further adding to the volatility, said Ajit Mishra, VP - Research, Religare Broking.

"As the signals are still mixed, we expect volatile swings to continue. Keeping in mind the scenario, we reiterate our cautious view and suggest keeping a check on leveraged positions," he said.

The rupee today strengthened against the US currency for the second straight session, closing 15 paise higher at 74.46 (provisional) amid a rally in the domestic stocks.

"The market pendulum swinging between risk-on & risk-off has become a trend now. However, the 15600 - 15900 range is unlikely to hold for long. If the upper band of 15900 is to be broken decisively, the essential requirement would be FIIs ceasing to sell at this level," says VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

"But even on Tuesday FIIs sold heavily ( 2385 crore). So watch out for FII activity. Meanwhile, the Delta variant scare, which led to the market sell-off on Monday on Wall Street, appears to have died down. Dr Fauci's statement yesterday that the vaccines are effective against all variants is reassuring," he added.

Results declared recently show pressure in financials like banks, insurance firms and NBFCs. "But these pressures are likely to be short-lived. Asian Paints' excellent numbers indicate that there are pockets of business coming out with flying colours in these pandemic times," said Vijayakumar. (With Agency Inputs)

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