Fag-end buying keeps mkts in green

Mumbai: Equity benchmarks staged a fag-end recovery to close in the green for the sixth straight session on Wednesday, propelled by IT counters and Reliance Industries (RIL) amid continuous foreign fund inflows and a largely positive trend in global markets. However, lacklustre macroeconomic data and a sharp drop in the rupee capped the gains, traders said.

In a volatile session, the 30-share BSE Sensex ended 214.17 points or 0.37 per cent higher at 58,350.53. During the day, it hit a high of 58,415.63 and a low of 57,788.78. The broader NSE Nifty went up by 42.70 points or 0.25 per cent to 17,388.15.

"Market has rebounded strongly with a turn in the trajectory of foreign investor flows -- the last four sessions have seen FPI inflows of nearly $1 bn. A perceived pivot in the Fed's tightening cycle and cooling off of crude oil prices have made the macro environment more favourable for India, which has outperformed EM and Asian peers by 6 per cent in the last week.

Going forward, the gap in valuations between Nifty and MSCI Emerging Markets index, as well as the gap between the earnings yield of Nifty vs 10 year G-Sec yield, would be adverse factors and we can expect market returns to be more muted," said S Hariharan, head (sales trading), Emkay Global Financial Services.

Foreign institutional investors (FIIs) remained net buyers in the capital markets as they bought shares worth Rs 825.18 crore on Tuesday, as per exchange data.

In the broader market, the BSE midcap gauge dipped 0.60 per cent and the smallcap index fell 0.28 per cent. Among the BSE sectoral indices, IT climbed 1.28 per cent, followed by teck (1.13 per cent) and finance (0.02 per cent). Telecom, capital goods, realty, auto, basic materials, FMCG and industrials were among the laggards. India's services sector lost momentum in July as demand was curtailed by competitive pressures, elevated inflation and unfavourable weather, a monthly survey said on Wednesday.