Noida, Aug 20 (APAC Media): Indian equity markets BSE Sensex and NSE Nifty staged a strong recovery on Thursday, with the Sensex and Nifty 50 snapping their recent losing streak as easing concerns over US bond yields, short covering and fresh buying in select heavyweight stocks improved investor sentiment.
The BSE Sensex gained 628 points, or 0.82%, to close at 77,537.72, while the NSE Nifty 50 rose 154 points, or 0.64%, to settle at 24,231.85.
The rebound came after a difficult stretch for Indian equities. The Nifty had declined for seven straight sessions, while the Sensex had fallen for four consecutive sessions. The sustained selling had pushed investors towards the sidelines, making Thursday’s recovery particularly significant.
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Market participants attributed the turnaround to three main factors.
First, traders covered short positions after the recent decline. The sharp fall in benchmark indices had created room for a technical rebound, with investors using lower levels to buy stocks that had been hit during the sell-off.
Second, global bond-market conditions improved. The US dollar weakened and Treasury yields eased, helping reduce some of the pressure on emerging-market assets. The US 10-year Treasury yield fell after the US Treasury announced plans to increase buybacks of longer-duration government debt.
A softer dollar and lower US yields are generally viewed as positive for emerging markets such as India because they can reduce pressure on foreign capital flows and improve the relative appeal of equities.
Third, foreign portfolio investors continued to provide support. Foreign investors bought Indian equities worth ₹408 crore in the cash segment on Wednesday, according to market data. Their purchases in August had crossed ₹23,000 crore through August 19.
Buying was not limited to a single sector. IT and financial stocks were among the key contributors to the benchmark recovery, while several large-cap counters also attracted demand.
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Eternal, Shriram Finance, Kotak Mahindra Bank, ITC and Bajaj Finance were among the notable gainers on the Nifty. HDFC Bank, ICICI Bank, Bharti Airtel, Eternal and Kotak Mahindra Bank also provided significant support to the index.
The broader market remained positive, although gains were more measured than those in the benchmark indices.
Analysts cautioned that Thursday’s rise should not yet be interpreted as a confirmed change in the market trend. Investors are likely to watch global bond yields, foreign fund flows, crude oil prices and geopolitical developments closely.
For now, the recovery has provided some relief after a prolonged period of selling, but sustained buying in the coming sessions will be crucial to determine whether the rebound can develop into a more durable recovery.
–ENDS–
Disclaimer:Â This article is for informational purposes only and is based on publicly available information. APAC Media is not responsible for investment decisions or losses. Please conduct your own research or consult a financial adviser before investing.
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