Sensex rebounds 690 pts; Nifty ends above 21,450; MTNL, Hindalco jump up to 20%

Domestic equity market rebounded from previous day's fall as the headline indices settled with big gains on Wednesday. Positive global cues and buying in the second half of the session ahead of January series month expiry lifted the market sentiments higher. However, traders are having a cautious approach on Dalal Street amid mixed cues.

For the day, BSE's Sensex surged 689.76 points, or 0.98 per cent, to settle at 71,060.31. NSE's Nifty50 jumped 215.15 points, or 1.01 per cent, to end the day at 21,453.95. Broader markets outperformed the headline peers as the BSE midcap and smallcap indices advanced about 1.7 per cent each. Fear gauge India VIX shed more than 3.2 per cent to 14.38-mark.​

Markets took a breather after Tuesday’s slide and gained nearly a percent amid volatility. The tone was negative at the beginning, however rebound in the select heavyweights not only capped the decline but also helped the Nifty to close in the green. The broader indices also witnessed some recovery, said Ajit Mishra, SVP - Technical Research at Religare Broking.

"The banking index tested its long term moving average on Wednesday so we can’t rule out some consolidation. However, it would be tough for other key sectors to trigger any meaningful recovery in Nifty. We thus feel traders should continue with a stock-specific trading approach and maintain positions on both sides," he said.

Barring the Nifty private bank index, all other sectoral indices settled in green. The Nifty media and metal indices surged about 3 per cent each, while the Nifty PSU Bank and oil & gas indices gained 2 per cent each for the day. The Nifty IT and FMCG indices were other key gainers for the day.

In the Nifty50 pack, Hindalco surged 4.7 per cent, while Dr Reddy's Laboratories, IndusInd Bank and Tata Steel rose 4 per cent each. HCL Technologies gained 3.5 per cent for the day. Among the laggards, ICICI Bank shed 3 per cent, whereas Axis Bank was down 2.7 per cent. Asian Paints dropped 1.7 per cent and Adani Ports settled 1.2 per cent down at the close.

The market rebounded from yesterday's sell-off taking cues from global peers. The sentiment was reinforced by the PBOC's cut in reserve ratio to boost growth and financial liquidity, siad said Vinod Nair, Head of Research, Geojit Financial Services. "Overall sentiment is muted as concerns persist on FIIs selling due to premium valuations in India and below expectation Q3 earnings."

A total of 3,884 shares were traded on BSE on Wednesday, of which 2,454 settled with cuts. 1,342 stocks ended the session with gains while 88 shares remained unchanged. During the day, 332 shares hit their upper circuit, whereas 268 shares tested the lower circuit levels for the day.

After witnessing heavy profit-booking in recent sessions, investors resorted to short covering ahead of F&O expiry on Thursday which helped benchmark Sensex close above the crucial 71,000 mark, said Prashanth Tapse, Senior VP (Research), Mehta Equities

"Despite the bounce back, one may see sharp gyrations in the market in the near to medium term due to a lot of uncertainty surrounding West Asia conflict, renewed inflation worries and delay in rate cuts from the US Fed," he said.

In the broader markets, Mahanagar Telephone Nigam, IFCI and Transformers and Rectifiers (India) hit an upper circuit of 20 per cent each. Andrew Yule and Company gained more than 19 per cent while Bombay Dyeing surged about 17 per cent. South Indian Bank and HFCL rose 13 per cent each.

Among the laggards, Ujjivan Financial Services dropped more than 8 per cent, while Karnataka Bank also fell on a similar line. Tanla Platforms dropped 7.5 per cent, while Gravitas India was also down 7 per cent. Bliss GVS Pharma dropped 6 per cent, while Tata Elxsi shed 5 per cent for the day.

Also read: Hot stocks on January 24: IRFC, HDFC Bank, IFCI, Tanla Platforms and more

Also read: Zee Entertainment shares rebounded 7% today. Here's why