The Indian equity benchmarks were on track to break their four-day losing streak led by Reliance Industries, HDFC Bank, ITC, State Bank of India, Axis Bank and Larsen & Toubro. The Sensex surged over 700 points and Nifty 50 index moved above its important psychological level of 18,000.
As of 12:55 pm, the Sensex was up 590 points at 60,435 and Nifty 50 index climbed 163 points to 17,970.
The rebound in markets came after US markets closed higher on Friday following a batch of mixed news on the economy. A key measure of inflation continued to slow, but it’s still far higher than anyone wants to see. Also, growth in consumer spending weakened last month by more than expected, but incomes were a bit stronger than expected. Markets are in a tricky spot where relatively solid economic data reduces the risk of a recession but also raises the threat of higher interest rates from the Federal Reserve.
"On technical grounds, Nifty has an immediate support at 17,730. Any move below the same may extend the fall toward 17,650-17,550 mark. On the flip side 17,900-18,000 will act as strong resistance levels. It’s a stock specific market, trade calls with strict stop loss," brokerage firm Nirmal Bang said.
Buying was visible across sectors as 13 of fifteen sector gauges compiled by the National Stock Exchange were trading higher led by the Nifty PSU Bank index's over 5 per cent gain. Nifty Metal, Media, Realty and Auto indices also rose between 1.7-2.5 per cent.
On the other hand, pharma and healthcare shares were facing selling pressure.
Mid- and small-cap shares were outperforming their larger peers as Nifty Midcap 100 index rose 2.9 per cent and Nifty Smallcap 100 index advanced 3.2 per cent.
Among the individual shares, NDTV rose as much as 5 per cent top hit an intraday high of Rs 357.60 on the BSE after its founders Radhika Roy and Pranoy Roy divested most of their shares in NDTV to Adani Group's AMG Media Network.
IndusInd Bank was top Nifty gainer, the stock rose 3.45 per cent to Rs 1,187. Hindalco, State Bank of India, Tata Steel, NTPC, Ultratech Cement, Bajaj Finserv, Eicher Motors, Coal India, ITC and ONGC also rose between 2-3 per cent.
On the flipside, Divi's Labs, Dr Reddy's Labs, Cipla, Kotak Mahindra Bank, Apollo Hospitals, Tata Consumer Products and Nestle India were among the notable losers.
The overall market breadth was extremely positive as 2,807 shares were advancing while 719 were declining on the BSE.
