Bargain hunting propels markets; Sensex up 213 points

Mumbai, Dec 10 (IANS) Bargain hunting and unravelling of short positions by investors propelled a barometer index of the Indian equities markets into provisionally closing with gains of 213 points on Thursday.

The barometer 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE) made gains after six consecutive days of losses. It provisionally closed higher by 213 points or 0.85 percent during the day’s trade.

Similarly, the wider 50-scrip Nifty of the National Stock Exchange (NSE) made gains during the day’s trade. It rose by 71 points or 0.93 percent at 7,683.25 points.

The Sensex of the S&P Bombay Stock Exchange (BSE), which opened at 25,136.71 points, provisionally closed at 25,248.56 points (at 3.30 p.m.) — up 212.52 points or 0.85 percent from the previous day’s close at 25,036.05 points.

The Sensex touched a high of 25,289.58 points and a low of 25,034.14 points during the intra-day trade.

The barometer index had receded by 1,134.23 points during the last six consecutive sessions, whereas the NSE Nifty declined by 343 points.

Market observers said that short coverings of position by investors led the relief rally after six consecutive days of losses.

“Markets ended in the green after six straight sessions of losses led by covering of short positions by traders,” Vaibhav Agarwal, vice president and research head at Angel Broking, told IANS.

Agarwal pointed out that markets positive trajectory might be short-lived due to the logjam in parliament and absence of fresh triggers.

“We do not expect any meaningful upside from current levels in the absence of any major trigger,” Agarwal elaborated.

“Investors will watch out for inflation and industrial production data over the next couple of days, for further direction. We also expect volatility to spike next week ahead of the US FOMC (Federal Open Market Committee) meet.”

Lately investors confidence was eroded due to the logjam in parliament which has dimmed the prospects of the Goods and Services Tax (GST) bill getting passed during the winter session.

Should the bill not secure clearance in this session, it will miss its intended roll-out date of April 1 next year.

Moreover, the continued selling of equities by the foreign investors ahead of a likely US rate hike spooked investors.

Apart from value buying and short coverings, forecast of positive monthly industrial output and inflation data points slated to be released on Friday brought back investors said Anand James, co-head, technical research desk with Geojit BNP Paribas Financial Services.

“Forecast and expectations of healthy index of industrial production (IIP) data and cooling of consumer price index (CPI) has added positive sentiment to the markets,” James told IANS.

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