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After opening marginally lower markets rebounded in early trades on Thursday led by gains in bank shares and index heavyweight Reliance Industries.
At 9:30AM, the 30-share Sensex was up 71 points at 20,284 and the 50-share Nifty was up 26 points at 6,173
On Wednesday, benchmark indices rallied to a 28-month high and the Bank Nifty shot up to a 30- month high led by rate sensitive shares after April wholesale price inflation which eased to a 41-month low of 4.89% rekindled hopes of a rate cut by the central bank.
Technical analysts say that the short-term bias is likely to be bullish as long as the Nifty sustains above 6,100. On the upside, the index can rally to 6,200, while on the downside; it is likely to get strong support around 6,040-6,060.
Asian shares got off to a positive start on Thursday. Tokyo’s Nikkei touched a fresh five-and-a-half year high, before reversing direction amid profit taking after sharp gains in the past few sessions. The Nikkei slipped further and was down 1.4% while the Hang Seng was up 0.3%, Shanghai Composite gained 1% and Straits Times was trading flat with negative bias.
The Bankex was the top gainer among sectoral indices on the BSE followed by Realty, Power, Healthcare, Metal, Oil and Gas indices.
Bank shares extended gains and were up on hopes of rate cut by the central bank. In the Sensex pack, ICICI Bank, SBI and HDFC Bank were up 0.7%-1.8% each.
Index heavyweight Reliance Industries was up 0.5%.
Bajaj Auto was up 0.7% ahead of its fourth quarter earnings today.
Other Sensex gainers include, Dr Reddy's Labs, ITC, Tata Steel, Bharti Airtel and NTPC.
Among other shares, Apollo Hospitals Enterprise, Oil India, Wockhardt, and GlaxoSmithKline Consumer Healthcare are trading higher by up to 4% in opening deals on inclusion in the MSCI India index with effect from June 1.
In the broader markets, the BSE Mid-cap was up 0.5% and the Small-cap index gained 0.3%.
Market breadth was positive with 635 gainers and 380 losers on the BSE.
