The 30-share Bombay Stock Exchange (BSE) Sensex, after losing more than 110 points in early trades, managed to end the day with a gain of 346.02 points or 2.19% to close above 16K at 16,153.66 points.
Meanwhile the broader Nifty of the National Stock Exchange (NSE) closed the day at 4879.65 points, posting a gain of 101.85 points or 2.13%%.
Technology and IT companies hogged the limelight on Tuesday as investors did some bottom fishing in these stocks anticipating better results from these companies for the financial year. The BSE IT index gained 203.10 points or 5.55% to close at 3,862.48 points while the BSE Teck posted a gain of 123.83 points or 4.08% to close the day at 3,161.24 points. Dealers said heavy short covering in some of the heavyweights also helped the market to bounce back from the day's low.
Alex Mathew, head, research, Geojit Financial Services, said, We had seen huge short covering on Nifty futures coupled with value buying in IT sector stocks which were neglected by investors previously. The IT sector may once again get renewed buying interest after quarterly numbers were announced of Infosys. We may see some surprises in Wipro and TCS. As far as Nifty is concerned, psychological resistance lies at 5,000 level and the major hurdle will be 5,100 while on the lower side it has got support at 4,750 and 4,665 levels. Some experts also believe that a lot of action is awaited in the mid and the small cap space in the days to come.
Some action was witnessed in the broader markets as investors resorted to short-covering intra day in these stocks. The overall markets breadth at the BSE remained positive with 1,784 stocks advancing as against decline by 875 stocks and 50 companies remained unchanged.
According to the data from the stock exchanges, foreign institutional investors, amid low gross values, were net sellers of Rs 56.52 crore of equities on Tuesday while the domestic institutional investors were net buyers to the tune of Rs13.27 crore.