Pullback rally halts 3-session slide

Market benchmarks roared back to life on Thursday after a three-session losing streak as investors piled into IT, banking and finance stocks amid a bullish trend overseas.

A recovering rupee and optimism surrounding the flurry of IPOs added to the momentum, traders said. The 30-share BSE Sensex soared 638.70 points or 1.22 per cent to finish at 52,837.21. Similarly, the broader NSE Nifty vaulted 191.95 points or 1.23 per cent to 15,824.05.

Milind Muchhala, executive director, Julius Baer, said: "Indian markets made a smart pull-back supported by the positive global set-up and a decent start to the Q1FY22 earnings season. Markets are clearly rewarding the stocks/sectors where the earnings momentum is strong (such as IT - especially midcap IT, cement, metals) or where growth visibility remains good (such as chemicals, healthcare, etc.). Moreover, with the flurry of IPOs, which are seeing a very healthy response from investors, the related sectors are seeing interest due to benchmark valuations. Also with the headline index remaining steady at elevated levels, the broader market (Midcaps/Smallcaps) continues to witness a lot of excitement/participation."

Vinod Nair, head (research) at Geojit Financial Services, said: "Taking cues from firm global markets, domestic market witnessed robust momentum shrugging off concerns over the spread of Covid-19 and FII selling. Global markets continued to hold onto gains owing to solid earnings reports and turned its focus on the European Central Bank's policy announcement. A confirmation by Fed to continue its supportive policy in the upcoming meet despite rising inflationary pressure will be a key factor in maintaining the direction of the rally."