Mumbai: Logging its first rise in three sessions, the benchmark Sensex on Friday recovered 109 points to reclaim 26,000 mark on gains in banking, capital goods and consumer durable shares on hopes that state election results would give a much-needed boost to economic reforms.
Exit polls have predicted BJP would gain majority in recently-held Maharashtra and Haryana assembly polls. Brokers say this would improve Centre-State co-ordination and consolidate BJP's position in Rajya Sabha, a key factor to push major reforms.
Smart rise in HDFC Bank, ICICI Bank, HDFC, L&T, SBI, M&M, Axis Bank, Hero MotoCorp, RIL, Bharti and Cipla shares mainly helped the market recover from two-month lows hit Thursday.
However, IT shares suffered a jolt after country's largest software services exporter, TCS, yesterday announced below-market-expectations second quarter results.
The 30-share Sensex resumed lower on mixed Asian cues and touched a low of 25,910.77. It gradually started to bounce back and logged a high of 26,248.54 on firm European trends, up by 250 points. Later, it pared some gains and finally settled at 26,108.53, a rise of 109.19 points or 0.42 percent.
In previous two sessions, Sensex had shed 384.73 points.
The wide-based 50-issue CNX Nifty of the NSE also gyrated in a range between 7,819.20 and 7,723.85 before concluding at 7,779.70 -- a net gain of 31.50 points or 0.41 percent.
"Markets are awaiting state elections outcome on Sunday which could make a difference to stocks," said Rajshekar Gowda, Senior Analyst, HBJ Capital.
Participants also drew some comfort from RBI Governor's statement that India is seeing a pick-up in economic growth although more could be done to support that on a sustainable basis, according to Jayant Manglik, President-retail distribution, Religare Securities.
On a weekly basis, the Sensex fell for the fourth straight week and lost 188.85 points.
TCS was the top loser from the Sensex pack with a fall of 8.73 percent and wiped out almost 175 points from the Sensex gains. Shares of HCL Tech, which today declared first quarter results for September end, fell by 9.09 percent after tepid earnings.
Meanwhile, Asian stocks closed mixed with a downward bias. Key indices from Hong Kong and Singapore closed with gains while from China, Japan, South Korea and Taiwan finished with losses.
European markets were trading strong in their late morning deals on hopes of more stimulus measures. The CAC was up by 1.95 percent, the DAX by 1.96 percent and the FTSE by 1.11 percent.
Jignesh Chaudhary, Head of Research, Veracity Broking Services said," After falling for two days, local equities eventually closed on the higher side. To start the day Indian local indices traded weak but as the day progressed, especially in the second half of the day there was marked recovery."
Twenty one scrips out of the 30-share Sensex pack ended higher while nine others finished lower.
Major gainers include BHEL (3.40 percent), Hero MotoCorp (3.05 percent), HDFC Bank (3.04 percent), M&M (2.88 percent), ICICI Bank (2.86 percent), Cipla (2.61 percent), SBI (2.30 percent), L&T (2.11 percent), Bharti Airtel (2.10 percent), Axis Bnak (2.04 percent), Tata Power (1.97 percent), Tata Steel (1.80 percent), NTPC (1.77 percent) and HDFC (1.65 percent).
However, other losers were Sesa Sterlite 2.76 percent, Hindalco 2.24 percent, Tata Motors 1.66 percent and Wipro 1.08 percent.
Among the S&P BSE sectoral indices, Bankex rose by 2.46 percent followed by Capital Goods 1.86 percent, Consumer Durables 1.81 percent and Power 1.34 per cent while IT dropped by four percent and Teck by 2.67 percent.
"The performance of the Indian equities remains contingent on resumption of FII flows. Reducing inflation, lower commodity prices and expected reforms push remain significant tailwinds for the markets," said Sanjeev Zarbade, Vice President- Private Client Group Research, Kotak Securities.
The total market breath continued to remain negative as 1,497 stocks finished lower, 1,332 ended higher and 119 ruled steady. The total turnover fell to Rs 3,095.99 crore from Rs 3,234.62 crore yesterday.
