Sensex off to a firm start, surges 170 pts; recovery in US, Asia fuel shortcovering

Domestic equities commenced Tuesday session with solid gains, a trend contrary to a series of downward movement witnessed over the past week, as overnight recovery in US markets and subsequent gains in other Asian markets fueled short covering in early trades. [caption id=“attachment_2493032” align=“alignleft” width=“380”]  Reuters[/caption] After resuming 102 points higher at 26,661, the Sensex advanced further to touch a high of 26,732 amid recovery in metals, banking and power stocks, which were subject to widepsread selling in recent trades. Early optimism in the market comes after benchmark Sensex faltered badly in the last six sessions, as more than 900 points were shaved off the index due to weak global market cues and subdued corporate earnings back home. At 10.05 am, the 30-share BSE S&P Sensex was at 26,692.18, up 133.03 points, or 0.5 percent from previous close. The broader 50-scrip CNX Nifty was at 8,086.35, up 0.4 percent or 35.55 points. Market breadth was extremely upbeat as gainers outnumbered losers by over 2:1, with 1,261 stocks advancing against 467 declines on BSE. Last night, key US gauges ended with gains of over 1 percent each, while major Chinese equity indices such as Hang Seng rose 1.4 percent and Shanghai Composite traded flat in today’s early trade even as Japan’s Nikkei took severe pounding and was down 2.1 percent. Domestic metal stocks were the star performers in early trade, with Hindalco jumping 3.3 percent to Rs 83.65, Vedanta rising 2.8 percent to Rs 99.65 and Tata Steel gaining nearly a percent to Rs 241. Among other major gainers, shares of NTPC, M&M, Axis Bank, Sun Pharma, Hindustan Unilever, Infosys and Reliance Industries were up around 1-2 percent each.