Sensex snaps four-day losing run as Nifty climbs back above 22,600

The indices recovered more than 1% from the day's lows in morning trade, led by metal and pharma stocks, but analysts warn that crude near $115 a barrel will cap any rally.

Indian shares bounced back on Monday morning, with the Sensex and Nifty recovering more than 1% from early losses and moving to end a four-day losing streak, The Economic Times reported.

The Sensex rose over 200 points to cross 73,330, more than 800 points above its intraday low of 72,515. The Nifty neared 22,660 after slipping below 22,400 earlier in the session. These were morning figures, and the indices could close at different levels.

Gainers and losers

Kotak Mahindra Bank rose more than 2% to lead the Sensex, after its September-quarter results.
Adani Ports, Tata Steel, Eternal, Sun Pharma, Axis Bank, Tech Mahindra, L&T, TCS and Trent gained 1–2% each.
Asian Paints, Infosys and HUL fell 1–2%.
Nifty Metal and Nifty Pharma rose more than 1%, while IT, FMCG and PSU bank indices slipped.

Mid-cap and small-cap indices edged up after Friday's crash. Market breadth was positive, with 2,092 stocks rising and 1,124 falling on the NSE. India VIX, the market's fear gauge, jumped 4% to near 18.

What analysts say

V K Vijayakumar, chief investment strategist at Geojit Investments, said Brent crude, though slightly cooler at below $115 a barrel, was still too high and would limit any rally from the Nifty's low of 22,600 last Friday. He advised investors to look for value buys created by the correction rather than track index levels.

He said Friday's crash in mid-caps and small-caps was mainly caused by the forced sale of shares bought with borrowed money. The broader market is still overvalued, he said, but the fall will open opportunities in high-growth segments. He also said the weakening AI trade is positive for India, as foreign investors have pulled more money out of South Korea and Taiwan than out of India in September and October.

Anand James, chief market strategist at Geojit, said the Nifty's close below its 20-day moving average on Friday, along with the rise in VIX, warns of a possible fall towards 21,600. A move above 22,690 would confirm strength for the day, he said, while failing to stay above 22,460 would signal more losses.

Background

The rebound follows a week in which Indian investors lost about ₹20.8 lakh crore as the Sensex fell 2.15% over four sessions, PTI reported over the weekend.

This article is for information only and is not investment advice.