Sensex and Nifty closed majorly bullish by the afternoon session on Wednesday, tracking gains in index-heavyweights Reliance Industries, HDFC and Bajaj Finance twins amid positive cues from global equities. Reversing the trend of 2 days of straight fall, Sensex ended 498 points higher to 35,414 and Nifty was gained 127 points to 10,430.
As per traders, domestic indices rallied today, on back of positive macroeconomic numbers indicating a recovery in world economies despite a spike in number of virus cases worldwide. Investors also reacted well to the Manufacturing Purchasing Managers' Index (PMI) that came in at 42, highlighting ease in manufacturing downturn for the month of June.
ITC, followed by Axis Bank, HDFC, IndusInd Bank, Bajaj Finance, SBI and Reliance Industries were among the top gainers in the Sensex pack. On the other hand, NTPC, Kotak Bank, L&T, ONGC and Nestle India were among the laggards.
Sectorally, PSU Bank closed highest rising 3.63% followed by a 2.7% rise each in Nifty bank, financials and private banking. Media, FMCG and metal too closed in green, while pharma, auto, IT and realty declined marginally by the closing bell.
Earlier, markets opened marginally higher amid volatility in global markets.
Expressing views on today's market trend, Vinod Nair, Head of Research at Geojit Financial Services said," Benchmark indices gained strength on the back of data showing that economic activity may be stabilising. The gains were led by banking index. The Nikkei PMI survey indicated that although activity contracted in June, it was at a much slower pace as compared to May. This gives rise to the hope that the economy may be emerging out of one of its worst periods in recent times.
"However, the continued rise in virus infections, and the resulting extension of lockdowns in many areas, may continue to slow and impact the economic recovery," he added.
On today's market trend, S Ranganathan, Head of Research at LKP Securities said, "A revival in GST collections during June and a smart comeback by the banking sector buoyed sentiments as market rose in trade today. The broader market too exhibited strength as savvy investors were seen lapping up select counters which seem to be less impacted from the Pandemic".
Overseas, markets in Europe stayed in red, while most Asian counterparts barring Nikkei and SGX Nifty traded in the green, tracking buoyancy from Wall Street. Chinese factory activity coming in at 51.2 was better than expected and helped to keep most Asian markets in green.
In the US, markets closed higher amid rise in coronavirus cases as investors focused on economic recovery data.
Ajit Mishra from Religare Broking said," It's the buoyancy of the global markets which aided surge amid rising cases in India. Besides, though we're seeing demand revival in select areas, it is still way lower compared to pre-COVID levels. We reiterate that the performance of the banking pack would play a critical role in the next directional move as other sectors, by and large, have done their part."
In terms of technical indicators, Nifty closed towards 10,400, that was expected as its earlier resistance level and further upside can be expected at 10,600 now. Nifty has been consolidating at 10,000 level recently.
As per outlook by Geojit Financial in its market radar report, a direct rise above 10,440, may invite short covering on Nifty but will have to take out 10,650 convincingly, before directional moves to 10,900 can be played.
On the Q4 result front, Eveready Industries, Intense Technologies are among the companies that will report Q4 results today.
In terms of coronavirus toll, there are currently 10,591,470 confirmed cases all over the world from the coronavirus COVID-19 outbreak, including 514,050 deaths.
India registered the highest single-day COVID-19 deaths at 507 on Wednesday with 18,653 new infections, taking the total tally to 5,85,493, according to the Union Health Ministry data.