Sensex recovers 620 points at 35,000, Nifty at 10,500-mark erasing initial losses; Yes Bank, Sun Pharma, Asian Paints stocks rally

Mumbai: Benchmark equity indices which opened with heavy losses on Tuesday ahead of the final assembly election results from five states, amid plummeting rupee after Reserve Bank of India (RBI) Governor Urjit Patel's unexpected resignation recovered after two hours.

The Sensex opened over 500 points lower at 517.97 points, or 1.48 percent, down at 34,441.75. However, it recovered 624 points and is trading at 35,050 points, up 90 points. Yes Bank, Sun Pharma, Asian Paints top gainers among Sensex pack

In a similar movement, the NSE Nifty recovered to 10,516 mark, 20 points up.  The Sensex tumbled 714 points, or 2 percent, to close at 34,959.72 in Monday's session. The Nifty too fell 205.25 points, or 1.92 percent, to end at 10,488.45.

"The markets are already in a downtrend. They have discounted a 3-0 whitewash. If even one state goes the BJP way, it will result in short-covering," said VK Sharma, Head PCG and Capital Markets Strategy, HDFC Securities.

"As far as the RBI Governor's resignation is concerned, it alone has the ability to knock off 200 points from the Nifty," he pointed out.

"Vijay Mallya's extradition order by UK court is positive for the markets, but will provide some cushion only later on when he actually lands in India," he added. Besides nervousness over election results, the plunging rupee also weighed on investor sentiment here, traders said.

Representational image. Reuters.

Representational image. Reuters.

The rupee opened 112 paise, or 1.50 percent, down at 72.44 after the unexpected resignation of the Reserve Bank Governor Urjit Patel Monday, four days ahead of a crucial meeting of the board of the central bank that could have discussed issues of simmering differences with the government.

Capital markets regulator Sebi and the stock exchanges have stepped up their surveillance systems to keep manipulative forces in check amid an extreme volatility expected during the day due to Patel's resignation and the state assembly results.

After a sharp plunge of over 700 points in the benchmark Sensex on Monday tracking the exit poll results for five states, analysts have warned that the final results showing declining votes for the ruling BJP and Patel's resignation could trigger even a bigger loss for the markets on Tuesday.

Meanwhile, Brent crude, the international benchmark, was trading 0.27 percent up at $60.13 per barrel.

On a net basis, foreign portfolio investors (FPIs) bought shares worth Rs 116.22 crore Monday, while domestic institutional investors (DIIs) were net sellers to the tune of Rs 145.80 crore, provisional data available with BSE showed.

Elsewhere in Asia, Hong Kong's Hang Seng was flat, Japan's Nikkei dropped 0.56 per cent, while Shanghai Composite Index was up 0.28 percent in early trade.

On Wall Street, The Dow Jones Industrial Average index rose 34.31 points, or 0.14 percent, to 24,423.26 on Monday.

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Updated Date: Dec 11, 2018 11:53:34 IST

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