Markets were trading higher on Tuesday morning session following gains across Asia, amid expectations that the policy makers in Europe would support the Euro-zone financial system. The Nifty advanced 81 points, to 4,913 and the Sensex gained 264 points, at 16,314.
US markets ended higher on Monday on expectations that European officials would mull a special purpose vehicle to buy bonds issued by the European countries suffering from debt crisis. Overnight, the Dow Jones Industrial Average gained 2.5%, the Nasdaq Composite added 1.4% and the S&P 500 surged 2.3%.
In Asia, Japan Nikkei Stock Average advanced 2%, the Hang Seng added 3% and the Shanghai Composite was up 0.7%. Back in India, analysts expect recovery on cards as the Rupee softened to 49.70 levels. Ashish Chaturmohta, Vice President - Derivatives and Technical Analyst from IIFL Wealth said, "Nifty future may face resistance around 4,960, sustaining above may lead to pullback towards 5050 levels."
While the global situation has improved, analysts said there may be some amount volatility ahead of the F&O expiry on Thursday. India Infoline in the morning note said, "The markets will also have to deal with the latest political storm over the 2G scam with P Chidambaram offering to step down. Any adverse development on the political front might just unnerve the markets."
Foreign Institutional Investors continued to be net sellers in Indian equities, they sold Rs 1083 crore in the cash, while the domestic institutional investors were net buyers of Rs 575 crore on Monday.
Among the sectoral indices, the BSE Realty and Consumer Durables were leading the gains, up almost 3% each.
From the broader markets, the midcap and the smallcap indices were up around 1.5% each.
From the realty space, Godrej Properties was on a firm ground, up 7%, DB Realty and Sobha Developers added over 3% each.
From Consumer Durables space, Rajesh Exports zoomed 8%, VIP Industries added 3.5% and Gitanjali Gems was up 3.3%.
On the Sensex, all the 30 shares were trading in the green. Reliance Industries advanced 3%, ICICI Bank gained 2.5% and Infosys was up 1.6%. All the three shares contributed 82 points on the Sensex.
Market breadth was positive, 1411 stocks advanced for 326 declining stocks.
