Sensex spikes over 400 points tracking global markets recovery

Extending gains after the yesterday’s sharp rally, domestic shares surged ahead in early Wednesday trade mirroring strong global markets recovery, with the benchmark Sensex scaling past the 25,700-mark as investors rushed to cover their short positions in several beaten-down sectors.

At 10 am, the 30-share BSE S&P Sensex was at 25,691.04, up 373.17 points, or 1.4 percent from previous close. A short while ago, the index advanced sharply to touch a high of 25,753.93, up 436 points. The broader 50-stock CNX Nifty was at 7,805.25, up 117 points, or 1.5 percent.

Market breadth stood firm with 1,413 stocks advancing against 216 declines on BSE.

In tandem with optimism in equity markets, domestic currency also sizzled in early trades with the rupee appreciating 18 paise to 66.36 against the dollar.

Responding to upbeat US markets close overnight where Dow Jones and Nasdaq ended over 2 percent each, other key Asian gauges such as Japanese Nikkei shot up nearly 6 percent while Chinese indices - Hang Seng and Shanghai Composite - were up around 2-3 percent each.

Germany’s economic data announced a day before provided some cheer to investors given the bleak global economic scenario as its imports and exports hit record highs in value terms in July. Also, investors are hoping Chinese government may undertake more proactive measures in terms of additional stimulus to prevent it from a hard landing.

Further, investors back home also took heart from the yesterday’s PM’s meeting with corporates and lenders, which focussed on ways to spruce up investment and clear hurdles to rise above the challenge.

Frontline commodity-related continued to attract significant buying support after the recent sell-off. Shares of Vedanta flared up 4.1 percent to Rs 97.30, Hindalco scaled up 2.7 percent to Rs 74.80 and Tata Steel was up 2 percent at Rs 233.45

Other blue-chip gainers such as Infosys, HDFC, Maruti, ICICI Bank, Axis Bank, Lupin, Bajaj Auto, SBI, Tata Motors and Dr Reddy’s were up over 1.50-2.7 percent each.