Sensex, Nifty rebound as financials jump

Indian shares snapped two sessions of losses on Thursday on the back of gains in financial stocks, as sentiment improved after daily coronavirus death tolls in some European countries fell.

The Nifty closed 0.76{b1ee4ac4d8d7b8e1af61a560a11ca52574b8103b547ccac8037ce0cdf9e7ba58} higher at 8,992.8, while the Sensex rose 0.73{b1ee4ac4d8d7b8e1af61a560a11ca52574b8103b547ccac8037ce0cdf9e7ba58} to 30,602.61. Both the indexes had fallen as much as 1.2{b1ee4ac4d8d7b8e1af61a560a11ca52574b8103b547ccac8037ce0cdf9e7ba58} earlier in the session.

Leading world stocks higher, the pan-European STOXX 600 index rose over 1{b1ee4ac4d8d7b8e1af61a560a11ca52574b8103b547ccac8037ce0cdf9e7ba58} in early trade, spurred by a drop in the virus death tolls in both Spain and Italy.

The Nifty 50 has rebounded around 20{b1ee4ac4d8d7b8e1af61a560a11ca52574b8103b547ccac8037ce0cdf9e7ba58} from multi-year lows hit in March.

But Goldman Sachs warned it does not see a “sustainable recovery rally” in the Nifty.

“We lower India to market weight within Asia on delayed recovery and extended valuations with a Nifty target of 9,600 by June 2021,” Goldman said.

Already reeling from a slowdown in economic growth, India earlier this week extended a lockdown to curb the spread of the virus, which has infected 12,380 in the country, including 414 deaths.

On Thursday, ICICI Bank Ltd rose 4.4{b1ee4ac4d8d7b8e1af61a560a11ca52574b8103b547ccac8037ce0cdf9e7ba58} and was the biggest boost to the indexes, while larger rival HDFC Bank Ltd rose 1.9{b1ee4ac4d8d7b8e1af61a560a11ca52574b8103b547ccac8037ce0cdf9e7ba58}.

But IT shares took a beating after Wipro Ltd flagged a hit from the COVID-19 pandemic, with Infosys Ltd closing 2.4{b1ee4ac4d8d7b8e1af61a560a11ca52574b8103b547ccac8037ce0cdf9e7ba58} lower.

Wipro, however, reversed early losses to close up 0.7{b1ee4ac4d8d7b8e1af61a560a11ca52574b8103b547ccac8037ce0cdf9e7ba58}.

Tata Consultancy Services Ltd closed down 1.1{b1ee4ac4d8d7b8e1af61a560a11ca52574b8103b547ccac8037ce0cdf9e7ba58} ahead of its quarterly results.

Also read: Domestic markets down as gloomy Wipro outlook hits IT stocks