 "Banks lead Sensex recovery as FIIs extend buying")
The BSE’s Sensex ended nearly flat at 19,997.45. NSE’s Nifty rose 16.4 points or 0.3 per cent, to close at 5,913.15.
Analysts are divided on the market outlook.
Some expect limited upsides from these levels after the week-long rally and in the run-up to the US Federal Reserve’s meeting on September 18 to discuss a partial rollback of the monetary stimulus. Indices have risen 11 per cent in five sessions, driven by a slew of measures from new Reserve Bank Governor Raghuram Rajan to curb the rupee’s fall and easing of tensions between the US and Syria.
Others see further upsides as the Nifty has closed above its 200-day moving average (DMA) of 5840-levels for the second straight day
“If Nifty closes above this level for one more day, we could see more gains because it would lay the foundation for a bull rally,” said AK Prabhakar, senior VP, Anand Rathi Financial Services.
Foreign institutional investors (FIIs) net bought shares worth Rs586.50 crore on Wednesday, according to provisional data, extending purchases to the fifth straight day. Since Wednesday, when Raghuram Rajan took charge of the Reserve Bank of India, FIIs have pumped Rs5190 crore into Indian equities.
The optimism on Wednesday was more pronounced in the broader market on Wednesday with advances outnumbering declines in the ratio 1407:948 on the BSE. BSE’s small-cap and mid-cap indices rose over 1 percent each.
Bank Nifty, which was trading weak for most of the day, ended 1.78 percent higher led by short covering in public sector banks. SBI rose 3.5 percent, Bank of India soared 10.5 percent and Bank of Baroda jumped 8.1 percent. Shares of metal companies and property developers were among the other top gainers on Wednesday.