A day after falling almost 5 percent, the Indian market logged healthy gains of more than 2 percent on an all-round buying, tracking positive global cues. With this, the market ended its seven-day losing streak.
Market sentiment improved after the US sanctions on Russia did not target Russia's oil exports nor their access to the Swift global payment network, giving hopes that the spiralling oil prices will ease.
Sensex ended 1329 points, or 2.44 percent, higher at 55,858.52 while Nifty finished at 16,658.40, up 410 points, or 2.53 percent. Mid and smallcap indices outperformed the benchmarks, jumping more than 4 percent each.
Barring two stocks- Hindustan Unilever and Nestle – all stocks in the 30-share pack Sensex closed with gains.
"Domestic indices staged a firm recovery tracking positive cues from global markets and took advantage of lower valuations following the massive sell-off in the previous session. Global markets took a breather as the fresh US sanctions did not target Russia's oil exports nor their access to the Swift global payment network," said Vinod Nair, Head of Research at Geojit Financial Services.
The overall market capitalisation of BSE-listed firms rose to 249.97 lakh crore from ₹242.3 lakh crore in the previous session, making investors richer by ₹7.7 lakh crore in a day.
Volatility may continue
Market analysts point out that the market will remain volatile in the short term and one should make calculated bets on quality stocks for the time being.
“The market will continue to remain volatile, tracking new developments in the Russia-Ukraine war,” said Nair.
On the technical front, the low of February 24 (16,203) remain a key level and if the market breaches that level, it can fall near 15,800-15,900 levels.
“Prices have given a negative confirmation with a break below the multiple support zone of 16800-16900 coinciding with the 200-day Moving average which on the upside could act as immediate resistance,” said Anu Jain, Head – Broking, IIFL Wealth.
“In the short-term sustainability below 16400 would indicate weakness for 15900 levels & broad range for the Market could be 15800-17050 levels. Global Markets have retraced back to important support levels and a temporary pullback and consolidation remains a probable scenario,” said Jain.
Amol Athawale, Deputy Vice President - Technical Research, Kotak Securities said if the war between Russia and Ukraine continues, the upmove could be short-lived and once again market sentiment could turn weak with bouts of volatility going ahead.
“It would be interesting to see whether the index holds the level of 16500 or not. However, if the index manages to trade above 16500, a pullback formation is likely to continue till 16900-17000. However, a strong possibility of one more short term correction is not ruled out, if the index closes below 16500. Below the same, there are chances that the Nifty could hit 16300-16100 levels," said Athawale.