After two consecutive days of decline in the Indian equity market, investor sentiments strengthened on Tuesday with the wholesale inflation easing in the month of July.
The Indian rupee, also recovered and ended four paise stronger at 69.90 against the dollar,hours after it crossed the 70-per-dollar mark and touched a new all-time low of 70.08 per dollar.
Both key indices — S&P BSE Sensex and the NSE Nifty50 — traded on positive note through out the day supported by a robust buying in healthcare and banking stocks, analysts said.
India’s annual rate of inflation based on wholesale prices eased to 5.09 per cent in July from a high of 5.77 per cent in June, official data showed on Tuesday.
The wider Nifty50 on the National Stock Exchange (NSE) closed at 11,435.10 points, higher 79.35 points or 0.70 per cent from the previous close.
The 30-scrip BSE Sensex closed at 37,852 points, higher 207.10 points or 0.55 per cent from the previous close of 37,644.90 points.
It touched an intra-day high of 37,932.40 points and a low of 37,689.71 points.
In the broader markets, the S&P BSE Mid-Cap rose by 0.89 per cent and the S&P BSE Small-Cap index ended 0.53 per cent higher from its previous close. The BSE market breadth was slightly tilted towards the bears with 1,390 declines and 1,302 advances.
“Positive macro-economic updates coupled with bargain hunting at lower levels after two sessions of losses gave a fillip to investor sentiment,” said Abhijeet Dey, Senior Fund Manager for Equities at BNP Paribas Mutual Fund.
“Following yesterday’s positive growth numbers, the lower inflation numbers released subsequently were viewed as a positive development by investors,” he added.
According to Deepak Jasani, the Head of Retail Research at HDFC Securities, the bounce-back came on the back of bargain hunting by investors and better European markets. Turkish Lira recovered by five per cent against the dollar leading to some stability in sentiments towards emerging markets, Jasani told IANS.
Investment-wise, provisional data with exchanges showed that foreign institutional investors sold scrip worth Rs 378.84 crore, while the domestic institutional investors bought stocks worth Rs 391.47 crore.
Sector-wise, the S&P BSE Healthcare rose 354.91 points, the banking index was up 302.46 points and auto index ended higher 132.72 points.
In contrast, the S&P BSE capital goods index declined by 92.18 points, followed by the industries index, which was down 7.26 points and the telecom index ended lower 3.96 points.
The major gainers on the S&P BSE Sensex were Sun Pharma, up 6.91 per cent at Rs 601.65; Yes Bank, up 2.87 per cent at Rs 381.75; ICICI Bank, up 2.17 per cent at Rs 332.30; Axis Bank, up 2.15 per cent at Rs 618.30; and Reliance Industries up 2 per cent at Rs 1,210.95 per share.
The major losers were Hero Motocorp, down 1.29 per cent at Rs 3,263; Larsen and Toubro, down 1.19 per cent at Rs 1,253.50; Adani Ports, down 1.03 per cent at Rs 373.45; Tata Motors (DVR), down 0.70 per cent at Rs 135.40; and Bharti Airtel, down 0.66 per cent at Rs 366.50 per share.