After a sharp fall earlier in the day, Dalal Street managed to recover a large part of its losses in the final hours of trade on April 2.
The session started on a weak note, with heavy selling triggered by global cues, but the mood shifted as the day progressed.
By the closing bell, both the Sensex and Nifty had come off their lows, and ending in a bull territory.
The Sensex closed at 73,319.55, down around 185.23 points or 0.25%, while the Nifty managed to hold above 22,713.10, up about 0.15%. The Nifty Bank index also ended upby around 0.19%.
The indices turned positive and the late recovery stood out after a steep decline earlier in the session.
It is also worth noting that markets will remain closed on April 3 on account of Good Friday, with trading set to resume on April 6.
Let’s take look at the key factors behind the smart rebound –
Sharp fall early in the day, but recovered in late trade
The session began with strong selling pressure after comments from US President Donald Trump raised concerns around the ongoing tension in West Asia.
His remarks reduced hopes of a near-term resolution, which weighed on global markets and spilled over to Indian equities.
During the day, the Sensex dropped over 1,500 points, while the Nifty also fell more than 2% at one point.
The decline erased most of the previous session’s gains and led to cautious sentiment among investors.
While the late rebound helped reduce losses with markets ending the day in positive territory.
Value buying helps markets recover
As prices fell sharply, buying interest started to emerge at lower levels. Investors stepped in to pick stocks that had corrected during the day, which helped the indices recover from their lows.
IT stocks lead the rebound
Technology stocks played an important role in the market’s recovery.
The Nifty IT index rose over 2%, ending in a green territory.
Stocks like Coforge, L&T Technology Services, HCLTech and Mphasis saw strong gains, while others such as Tech Mahindra, TCS, Wipro and Infosys also traded higher.
Strong rupee adds support
Another factor that helped sentiment was the sharp movement in the Indian rupee.
The currency recorded a significant gain during the session after authorities stepped up measures to curb speculation against it.