Benchmark index Sensex bounced back from losses in early trade on June 2 and continued to be positive due to short covering on the expiry of the Nifty 50’s weekly derivatives contract, analysts said.
At 12:35 pm on June 2, Sensex was trading at 73999.17 and within the next one hour, the index rose 800 points to trade at 74807, representing over 1 per cent gains for the benchmark.
“Sectoral participation remained positive, with IT extending its rebound and surging 4.33 per cent, while auto, FMCG and realty stocks also contributed to the recovery. Broader markets traded with a mixed bias but ended higher, with gains ranging between 0.25 per cent and 0.41 per cent.
“The rebound was primarily driven by buying in heavyweight stocks across sectors despite persistent geopolitical uncertainty in West Asia and continued foreign institutional selling. Short covering ahead of the weekly expiry provided further support to sentiment and accelerated the recovery in the latter half of the session,” said Ajit Mishra, SVP, research, Religare Broking.
After a nearly 3 per cent slide over the previous four sessions that was driven by Iran war jitters and unprecedented foreign outflows, the benchmark Nifty 50 rose 0.43 per cent to 23483.55 on Tuesday, while the BSE Sensex gained 0.52 per cent to 74649.84.