Mumbai, April 2 – Stock markets staged a strong recovery on Thursday, erasing early losses to close higher, with the benchmark Sensex rising by 185 points and the broader Nifty settling above 22,700, driven by strong value buying in IT and banking shares and a sharp rebound in the rupee.
After rebounding more than 2,000 points from the day's low, the 30-share BSE Sensex finally closed higher by 185.23 points, or 0.25 per cent, at 73,319.55. The index opened lower and then plunged by 1,588 points to hit a day's low of 71,545.81 in the first half of the session. Strong value buying in key IT companies like HCL Tech and TCS, and major banking giants HDFC Bank and ICICI Bank, helped the market recover, reaching a high of 73,568.54 before closing.
The 50-share NSE Nifty followed a similar trend and closed above 22,700 at 22,713.10, up by 33.70 points, or 0.15 per cent. The index fell 496.85 points, or 2.19 per cent, in early trading before recovering to hit a high of 22,782.30.
A sharp rebound in the rupee, following intervention by the Reserve Bank with a series of measures to restrict banks from trading in onshore forward markets, also boosted investor sentiment. The rupee rebounded by 188 paise to briefly touch the 92 level against the US dollar before settling over 150 paise higher.
Value buying in IT stocks supported the recovery, with HCL Technologies and Tech Mahindra ending nearly 3 per cent higher.
Infosys, Tata Consultancy Services, HDFC Bank, Bajaj Finance, Maruti Suzuki India, Titan, Axis Bank, Bharat Electronics Ltd, Kotak Mahindra Bank, and ITC were among the major gainers in the Sensex.
Asian Paints, Eternal, Sun Pharmaceuticals, NTPC, Reliance Industries, PowerGrid, Mahindra & Mahindra, UltraTech Cement, Adani Ports, Bajaj Finserv, and Tata Steel were the only laggards.
"Indian equity markets opened on a negative note as Trump's renewed threat to strike Iran 'extremely hard' quickly erased the optimism built in the previous session, triggering broad-based selling across Asian markets," Vinod Nair, Head of Research, Geojit Investments Ltd, said.
The RBI's twin regulatory actions—limiting banks' net open rupee positions and prohibiting corporates from offering NDFs—though disruptive to banking operations in the near term, achieved their intended effect, mechanically forcing dollar unwinding and engineering a meaningful rupee recovery, Nair added.
US President Donald Trump, in his first national address since the Iran war began, said that the US will continue to target Iran 'extremely hard'. The United States will "finish the job" in Iran soon as "core strategic objectives are nearing completion" and military operations could wrap up soon, Trump said in his Wednesday night speech.
Crude oil prices surged by more than 7 per cent after Trump's speech. Brent crude, the global oil benchmark, traded 7.28 per cent higher at USD 108.52 per barrel.
Asian markets ended broadly lower, with South Korea's Kospi declining 4.47 per cent, Japan's Nikkei 225 falling 2.40 per cent, Shanghai's SSE Composite slipping 0.74 per cent, and Hong Kong's Hang Seng losing 0.70 per cent.
European markets were also trading lower, with Germany's DAX declining 1.71 per cent, Paris' CAC 40 falling 0.98 per cent, and London's FTSE 100 slipping 0.12 per cent.
The US market ended significantly higher on Wednesday.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 8,331.15 crore on Wednesday, according to exchange data. Domestic Institutional Investors (DIIs), however, bought stocks worth Rs 7,171.80 crore.
On Wednesday, the 30-share BSE Sensex jumped 1,186.77 points to settle at 73,134.32. The 50-share NSE Nifty climbed 348 points to end at 22,679.40.
