India’s benchmarks record best day in six weeks on bargain buying, global cues

India’s benchmark indexes logged their best day in six weeks on Tuesday, closing near one-month highs, as investors scooped up cheaper stocks on hopes that the market has bottomed out.

The Nifty 50 closed 1.45% higher at 22,834.30, while the BSE Sensex rose 1.53% to 75,301.26.

The MSCI Asia ex-Japan equity index jumped 1.3% on optimism over China’s economy.

The Nifty 50 logged losses for five months in a row starting October - its longest monthly losing streak in 29 years. The index is up 3.2% in March so far, trimming its losses since late September to 13.1% from 16.4%.

“Nifty’s rebound from 22,000 to 22,750 signals a crucial inflection point, with short-covering adding to the momentum,” said Kranthi Bathini, director of equity strategy at Wealthmills Securities.

“While concerns over U.S. tariffs linger, markets believe India’s proactive engagement will soften the impact.”

All 13 major sectors rose, with financials and automobiles providing the biggest boost to bluechip indexes.

Financials lead rise in Indian shares

Financial services index rose about 2% to a three-month high, as ICICI Bank and HDFC Bank provided the biggest boost with a 3.2% and 2.3% jump, respectively.

“Financials are back in favour as investors hunt for bargains after a sharp selloff. The IndusInd Bank scare briefly rattled sentiment, but RBI’s reassurance has restored confidence,” Bathini said.

Metal stocks rose 2.1%, driven by top consumer China’s stimulus plan and a weaker dollar.

A stronger Chinese economy is seen driving base metal prices higher and reducing the possibility of China dumping the commodity in other markets, aiding the prospects for Indian steelmakers.

The broader mid-caps and small-caps jumped 2.7% and 2.2%.

Bucking the trend, Bajaj Finserv fell 1.4%, after Germany’s Allianz said it was selling its stake in the unit to joint venture partner Bajaj Group for ~2.6 bln euros ($2.84 bln), which Kotak said was 28% lower than its fair value.