Sensex bounces back, gains 292 pts

Maruti Q4 results & fall in oil prices bring investors back to the market.

Investors shrugged off concerns over the stock exchange authorities' decision to increase exposure margins in both the cash and derivatives segment and went bargain hunting on Wednesday.

Coupled with this, short-covering ahead of the expiry of the April series derivatives contracts propelled the Sensex up by 291.75 points.

A strong recovery in Asian markets and a slight fall in global crude oil prices aided the sentiment. Buoyant earnings reported by the likes of Cipla and Maruti Udyog also propped up the mood, dealers said.

The BSE Sensex settled 291.75 points higher at 11,938.53, after surging to an intra-day high of 11,965.09. Markets climbed 330 points from the day's low, before finally ending lower.

The S&P CNX Nifty closed 93.10 points up at 3,555.75 after soaring nearly 100 points to as high as 3,562.30 in intra-day trade.

Key indices in Asian markets like Hong Kong, Japan, South Korea, Australia, Singapore and Taiwan were up by around 0.5-1.5 per cent. Heavy FII sales, increase in margins by stock exchanges, and high oil prices had caused a huge 383.52 points fall in the Sensex in the last two trading sessions.

Analysts said the market had tumbled without any buying support and lack of volume. But on Wednesday there was genuine buying activity and also the strengthening dollar drove up the prices of IT stocks.

Thanks to a firm trend in global metal prices, metal stocks forced their way back into the reckoning. Mirroring the gains recorded by stocks in the sector, the BSE Metal index rose nearly 4.08 per cent on Wednesday.

Led by Maruti Udyog, automobile stocks surged higher and lifted the BSE Auto index up by 2.98 per cent. The Oil & Gas, PSU, IT, Teck and FMCG indices climbed up 2-2.9 per cent while the FMCG index shot up by 2.48 per cent and the healthcare index firmed up by 1.17 per cent. BSE Midcap and Smallcap indices went up by 1.57 per cent and 1.82 per cent, respectively.