The domestic key equity indices closed on a positive note for the fourth consecutive session on Thursday. The NSE Nifty 50 rose 283 points or 1.24% to settle at 23,190.65, while the BSE Sensex jumped 899 points or 1.19% to finish at 76,348. The rally was boosted by the likely short-covering of foreign institutional investors.
FIIs were the net buyers of Rs 3,239.14 crore in the cash markets on Thursday. They bought in the markets for the second time in March. However, domestic institutional investors were the net sellers for the first time in 29 sessions, paring Rs 3,136.02 crore. “Markets are rallying on the back of shortcovering seen over the last 3-4 sessions. FIIs have been covering shorts aggressively in the past few sessions,” said Ajit Mishra, Senior Vice President of Retail Research at Religare Broking.
Nifty Oil and Gas was the top gainers among the sectoral indices, rising 1.57% in Thursday’s trade. It was followed by Nifty Auto which surged 1.42% closing at 21,623.05.
The Nifty Bank climbed 360 points or 0.72% to close at 50,063. In line with the benchmarks, the BSE Midcap jumped 252.70 points or 0.61% to close at 41,359.70.
Sectoral Index
In the broader markets, small- and mid-cap stocks closed the day on a positive note. The volatility index India VIX cooled off 5.22% to the 12.60 level.
The market breadth remained in favour of bulls. Bharti Airtel (4.08%) was the top gainer in the Nifty 50, followed by Titan (3.47%), Eicher Motors (2.61%), Bajaj Auto (2.57%), and Britannia (2.57%). Meanwhile, IndusInd Bank, Bajaj Finance, Trent, and Shriaram Bank were the major losers in the Nifty 50.
“Consistent falls of the US dollar index (DXY) have reduced the intensity of FII selling while DII buying continues to be strong, thus triggering the recent upside. Supportive domestic data indicating a MoM rise in economic activity and the view that more rate cuts are envisaged during the year are adding to the attractiveness of equity,” said Vinod Nair, Head of Research at Geojit Financial Services.
Technically, markets formed a bullish candle on daily charts, supporting a further uptrend from the current levels. “We believe that the overall market sentiment is bullish, but buying on dips and selling on rallies would be the ideal strategy for day traders,” said Shrikant Chouhan, Head of Equity Research at Kotak Securities.