Swinging Sensex rises 732 points in one day

Mumbai: Indian equity markets rose the most in nearly two-and-a-half years on Friday, recouping most of the losses from Thursday, in sync with a bounceback in world equities. A a recovery in rupee also helped the sentiment.

The BSE’s 30-share Sensex rose 2.15% or 732.43 points to close at 34,733.58 points, while the National Stock Exchange’s 50-share Nifty closed 2.32% or 237.85 points up at 10,472.50 points.

It was the Sensex’s and Nifty’s best gains in percentage terms since May 2016.

Meanwhile, the home currency ended at 73.57 a dollar, up 0.75% from its Thursday’s close of 74.13. The currency opened at 73.80 a dollar and touched a high of 73.52.

“There was short covering as oil dropped and rupee recovered. It is very difficult to gauge the market. It is very difficult to form an opinion until it settles down,” said Jinesh Gopani, head of equities at Axis Mutual Fund.

Brent crude fell 4.27% this week and now hovers at $80.55 a barrel, taking cues from the sell-off seen in world markets earlier this week.

“We wake up to knee-jerk reactions each day and that doesn’t say anything about the trend. Volatility will continue for while,” said Gopani.

Everyone seemed to agree that volatility was going to be the flavour of the season and caution prevailed.

“This kind of high volatility is likely to continue for some time given the global and domestic environment,” said Navneet Munot, chief investment officer, SBI Funds Management Pvt Ltd.

“Instead of a top-down sector view, bottom-up stock picking is a better idea,” said Munot.

For the year to date, foreign institutional investors (FIIs) have pulled out a net of $3.9 billion, while domestic institutional investors (DIIs) invested a net of 96,371.44 crore.

FIIs sold for the tenth straight session on Friday, as they offloaded a net of 1,322.13 crore of Indian shares, while DIIs stocked up a net of 1,287.29 crore of the asset class, provisional NSE data showed.

All the sectoral indices except BSE IT and BSE Teck closed higher. BSE Auto index and BSE Metal index rose the most, with 4.01% and 3.83% gains, respectively. Energy and telecom conglomerate Reliance Industries Ltd contributed the most to Sensex’s gains, rising 3.42% for the day. Private lender HDFC Bank Ltd and cigarettes-to-hotels business ITC Ltd followed, rising 2.23% and 3.58% respectively.

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