The market managed to see recovery in later part of the session on Wednesday ahead of expiry of Nifty September derivative contracts. Equity benchmarks fell 1 percent in morning trade on weakness in Asian peers after weak Chinese data, but positive European cues helped Indian equities rebound sharply.
The 30-share BSE Sensex rose 171.15 points or 0.67 percent to 25822.99 and the 50-share NSE Nifty climbed 33.95 points or 0.43 percent to 7845.95. The broader markets too gained in line with benchmarks; the BSE Midcap and Smallcap indices advanced 0.5 percent and 0.7 percent, respectively.
Experts said they expect rangebound trade to continue in near term but they feel there are lot of opportunities for investment post recent correction.
The Nifty is expected to remain in tight range of 7500 to 8100, Mayuresh Joshi of Angel Broking said. Delay in corporate earnings recovery could drive market towards the lower end, he added.
According to Nandan Chakraborty of Axis Capital, in the next one year some of the positives for Indian economy could be in terms of cut in interest rates and government’s focus on infrastructure capex leading to boost in corporate capex.
However, India in isolation cannot continue to outperform if the world is not doing well, and currently the world is not doing that well, Chakraborty said.
Globally it was a mixed day. Key indices in Asia finished lower as China’s September flash manufacturing PMI fell to a 6.5-year low of 47. Shanghai Composite and Hang Seng dropped 2 percent each. However, European markets managed to shrug off the Chinese growth concerns with the France’s CAC, Germany’s DAX and Britain’s FTSE gaining around 0.7-1.4 percent (at 16 hours IST).
Meanwhile, Prime Minister Narendra Modi kicked off his two nations’ tour in Ireland today. He will meet Irish counterpart Enda Kenny and also attend an Indian community event before departing for New York.
Banking, technology and select oil stocks supported the market in later part of trading session.
HDFC Bank, Lupin, Mahindra & Mahindra and Vedanta were top gainers in trade today, up 2-3 percent followed by Infosys and ICICI Bank with more than 1 percent upside.
ITC rallied 1.7 percent despite UP Government has raised VAT on tobacco & cigarette to 40 percent from 25 percent.
Larsen & Toubro also recovered, closing up 0.8 percent. The stock lost more than 2 percent in morning trade after rating agency ICRA downgraded term loans worth Rs 1,500 crore of toll road SPVs to default.
However, state-run power equipment maker BHEL lost 1.2 percent after rating agency CRISIL has lowered outlook on the company due to power sector overhangs. Tata Motors and Bharti Airtel were other major losers, down around 1.5 percent.
In the broader space, IDBI Bank rallied 9 percent. MD and CEO Kishor Kharat said while he hasn’t heard any news of an Axis Bank like structure for IDBI Bank, but it would certainly be a welcome move if it happens.
Dishman Pharma jumped 16 percent close more than seven-year high of Rs 306.95 after the company announced a tie-up that makes them exclusive supplier of the API for Janssen’s tuberculosis drug – Sirturo.
Visa Steel was locked at 20 percent upper circuit as the company confirmed that lenders have decided to invoke strategic debt restructuring in the joint lenders forum meet.
Tide Water Oil rose 3.5 percent on the back of surprise open offer announcement by minority shareholders. Standard Greases & Specialities has tied up with Janus Consolidated Finance, Alpha TC Holdings and Tata Capital Growth Fund to acquire 26 percent stake in Tide Water.