Sensex stages 1,700 pts rebound from day's low; Nifty nears 24,650; key details

Benchmark indices Sensex and Nifty staged a strong rebound on Friday afternoon, surprising many. A recovery was also observed in the broader market, though two out of every three stocks were still trading lower.  Sensex was quoting at 81,803.22 in afternoon trade, up 443 points. This was 1,720 points high than intraday low of 80,082.82 level it hit earlier today. Nifty was near 24,650 after testing sub-24,200 level. A total of 18 Sensex stocks entered positive terrain by 12.30 pm. Only Bharti Airtel was quoting in the black earlier today.

Among Sensex stocks that gained the most included Bharti Airtel (up 4 per cent), followed by Hindustan Unilever (1.51 per cent), UltraTech Cement (1.08 per cent) and Power Grid (0.96 per cent). Tata Steel and JSW Steel the worst index performers cut losses and were down 2 per cent each. IndusInd Bank, Axis Bank, Bajaj Finserv and Tech Mahindra also cut losses. 

European markets opened slightly higher. S&P500 futures edged higher.

"We believe 5 per cent earnings yield is fair value for Indian equities which translates to 20 times forward EPS and a Nifty target for 2025-end at 26,300," ICICI Securities said.

While stocks were earlier down amid concerns over firm US dollar of late, ICICI Securities said Donald Trump’s victory euphoria may reverse, as it did in 2017 when dollar index reversed gains post the initial euphoria. The US bond yield spike this quarter is unlikely to sustain as inflation trajectory is conducive, it said.

Earlier today, Asian markets across China, Hong Kong and Japan fell as no fresh details on fiscal stimulus were offered by China’s Central Economic Work Conference, even as authorities there pledged to boost consumption.

"There is resumption of selling by the FPIs as they sold stocks worth Rs 3,560 crore yesterday. Given the high valuations in India, FPIs are likely to sell more at every market rise. Selling has been profitable for FPIs since the dollar has been appreciating after the US elections," said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

The US dollar index, which tracks the dollar movement against a basket of six major world currencies, edged 0.15 per cent to 107.11. The US10-year bond yield climbed to 4.324 from 4.151 on December 6.

Earlier this week, Kotak Securities said it sees Nifty at 28,800-mark in its bull case scenario and 23,300 level in its bear case scenario. Kotak Securities believes that government and private capex is expected to revive in 2025. The brokerage expects the government to spend Rs 6.9 lakh crore in the second half of FY25.