Indian markets staged a late-day rally in a volatile day of trading despite negative trading in most global markets. Buying in selective frontline stocks pushed the Sensex higher by 151 points to 16,063, after it had sank nearly 350 points at its day’s low. The Nifty closed up 54 points at 4,765.
“The markets have been very volatile. They have corrected almost 12-13 per cent from the highs of 5,180. So investors should take a long to medium term perspective and use these levels to buy in the markets,” said Gaurang Shah, AVP, Geojit BNP Paribas Financial Services.
Buying interest was seen in metal, realty and power stocks. The metal index on the BSE rose nearly 3 per cent and the realty index was up 2.6 per cent. JSW Steel gained 7.3 per cent and Gujarat NRE Coke advanced 6.4 per cent.
The power index was also up 2.5 per cent. Suzlon Energy spiked 13.3 per cent to close at Rs 62.
Among the Sensex stocks, Rel Infra was up 5.6 per cent at Rs 1,089 and RCom surged 5.3 per cent to Rs 178. Hindalco also ended 5 per cent higher at Rs 125.
SBI, however, was the biggest loser in the group, down 1.1 per cent.
World stock markets dropped on Thursday as the US Federal Reserve failed to reassure investors that a lasting recovery in the global economy was taking hold.
The US central bank decided Wednesday to keep a key interest rate at a record low and said cheap credit would continue for an "extended period" as the world's largest economy struggles to regain its footing after its worst downturn in decades.
For many investors, the news raised doubts about whether the turnaround under way in many economies was strong enough to extend a powerful eight-month rally in global markets. A key US unemployment report due on Friday, which could yield clues about the ailing U.S. consumer and demand for Asian exports, also kept traders on edge.
"Around these levels, it's hard to have conviction positions," said Jan Lambregts, head of research of Rabobank in Hong Kong. "There's a big question on investor confidence given issues about the sustainability of the global recovery once stimulus policies fade."
As trading got under way in Europe, benchmarks in Britain and Germany dropped nearly 1 per cent.