Sensex rebounds 1,564 points, Nifty up jumps 446 on strong gains in banking, IT stocks

Sensex, Nifty had plunged more than 1.4% on August 29

The bull statue at the Bombay Stock Exchange (BSE), Mumbai. File | Photo Credit: Arunangsu Roy Chowdhury

Benchmark BSE Sensex and Nifty soared over 2.5% to log their best single-day gain in more than three months on Tuesday driven by value buying in banking, IT and oil stocks amid mixed global cues.

The 30-share Sensex jumped 1,564.45 points or 2.70% to settle at more than one-week high of 59,537.07. During the day, it zoomed 1,627.16 points or 2.80% to a day's high of 59,599.78.

The broader NSE Nifty spurted 446.40 points or 2.58% to close at 17,759.30 as all 50 components advanced.

The key indices logged their best single-day gain since May 20. The indices had tumbled more than 1.4% on Monday after U.S. Federal Bank chair Jerome Powell indicated last week that the country’s central bank will stick to a strategy of rate hikes to cool inflation.

Making a sharp recovery, all the 30 Sensex shares ended in the green. Bajaj Finserv rallied the most by 5.47%, followed by Bajaj Finance which jumped 4.86%.

IndusInd Bank jumped 4.38%, Tech Mahindra by 3.96%, ICICI Bank by 3.72%, Kotak Mahindra Bank by 3.46%, Tata Steel by 3.29% and HDFC by 3.28%.

Gains in Reliance Industries, HDFC Bank, Infosys, TCS, HUL, SBI, Axis Bank and ITC fuelled the rally.

"Today's rebound indicates the domestic economy's resilience in comparison to its global peers. Although the markets are currently at premium valuations, continued support from foreign investors aided domestic stocks to inch higher," said Vinod Nair, Head of Research at Geojit Financial Services.

A correction in crude oil prices and losses in the U.S. dollar in the global markets also boosted the investor sentiment, analysts said.

"Markets made a remarkable recovery and gained over 2.5% amid mixed global cues. After the gap-up start, the benchmark moved from strength to strength till the end and settled around the day’s high," Ajit Mishra, VP-Research, Religare Broking, said.

All the sectoral indices participated in the move wherein banking and financials contributed the maximum. In line with the trend, the market breadth was also inclined strongly on the advancing side, he said.

In the broader market, the BSE midcap gauge jumped 1.97% and smallcap index climbed 1.40%.

All the BSE sectoral indices ended in the green, with realty rallying 3.51%, bankex advanced 3.33%, finance jumped 3.18%, utilities (2.82%), power (2.82%) and oil & gas (2.65%).

A total of 2,397 stocks advanced, while 1,028 declined and 127 remained unchanged.

Stock markets in Europe were trading higher during mid-session deals. The U.S. markets had ended lower on Monday.

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

Meanwhile, the international oil benchmark Brent crude declined 2.60% to ₹102.52 per barrel.

Foreign institutional investors (FIIs) offloaded shares worth ₹561.22 crore on Monday, according to exchange data.