Sensex extend winning run to 3rd day as financial, energy shares advance

Benchmark Sensex and Nifty closed higher for a third session in a row on Wednesday as fag-end buying in banking, financial and oil stocks helped the indices rebound from early lows amid a bearish trend in global equity markets.

Covering-up of short positions by bears supported a late recovery in stocks and helped wipe off losses, traders said. However, a weak rupee against major rivals overseas weighed on market sentiment and restricted gains, they added.

In a largely subdued session, the 30-share BSE Sensex ended 123.63 points or 0.21 per cent higher at 60,348.09 as 17 of its constituents gained and 13 declined. The barometer opened lower and stayed negative for most part of the trading session due to losses in Asian markets.

Fag-end buying in select index heavyweights helped the index to pare all the losses and settle in the green. During the session, the index touched a high of 60,402.85.

The broader NSE Nifty settled higher by 42.95 points or 0.24 per cent at 17,754.40. Nifty made a negative start and fell by more than 100 points during the day to a low of 17,602.25.

IndusInd Bank was the biggest gainer on the Sensex chart, rising 4.75 per cent, followed by M&M, L&T, NTPC, ITC, Ultra Cement, Tata Steel, Maruti and SBI.

In contrast, Bajaj Finance, Tech Mahindra, Infosys and Sun Pharma were among the losers, shedding up to 2.30 per cent.

In the broader market, the BSE midcap gauge rose 0.61 per cent, and the smallcap index gained 0.28 per cent.

Among the sectoral indices, utilities rose 1.91 per cent, power gained 1.79 per cent, capital goods by 1.23 per cent, and auto by 0.95 per cent.

Realty, metal, consumer durable, IT and healthcare were among the laggards.

"Domestic equities opened gap down in line with global markets post the hawkish commentary from US Fed Chair Jerome Powell. But value buying at lower levels led the markets to reverse their losses and close in green," Siddhartha Khemka, Head - Retail Research, at Motilal Oswal Financial Services Ltd said.

The Indian equities despite negative global sentiment witnessed a sharp rebound from the lower end. The Nifty index remains in a buy mode as long as it holds the support of 17,500 on the downside where fresh put writing has been observed, said Kunal Shah, Senior Technical & Derivative Analyst at LKP Securities.

"The global market has fallen back into the grip of uncertainty as the Fed chief signalled the possibility of a prolonged and faster rate hike, contradicting a dovish comment made by another Fed official last week.

"The market now anticipates a 50 bps rate hike, which has pushed the dollar index to a three-month high. However, a strong recovery was seen in the domestic market towards the end of the day, which kept the bulls on the move," according to Vinod Nair, Head of Research at Geojit Financial Services.

Going ahead, the market is likely to continue with its volatility till the next US Fed interest rate decision outcome (due later this month), where investors are now building in expectation of a 50-bps rate hike.

As per the Fed Chair, the ultimate rate hike is likely to be higher than previously anticipated given the stubborn inflation. Till there is clarity on the interest rate front, the market is likely to be volatile in a broader range, Khemka said.

Elsewhere in Asia, markets in Shanghai, Seoul and Hong Kong ended with losses, while Tokyo settled in the green.

Equity exchanges in Europe were trading with losses in the afternoon session. The US markets had ended significantly lower in the overnight session.

The rupee slipped 13 paise to close at 82.05 (provisional) against the US dollar on Wednesday. International oil benchmark Brent crude was trading 0.16 per cent lower at USD 83.16 per barrel.

Foreign Institutional Investors (FIIs) were net buyers in capital markets as they bought shares worth Rs 3,671.56 crore on Monday, according to exchange data.