The stock markets managed to rebound and close in the green on Tuesday despite the substantial intra-day fall following the RBI's credit policy announcement leaving rates unchanged.

According to analysts, this bounceback was owing to improved stability in the European markets ahead of the crucial meeting by European Central Bank this week.

The Sensex closed at 17,237, up 93 points or 0.54 per cent, while the Nifty ended the day at 5,229, up 30 points or 0.56 per cent. The rally was led by movement in oil and gas and realty sectors. However, consumer durables, banks, power and infrastructure sectors were worst hit at the bourses on Tuesday.

The central bank kept repo rate and CRR unchanged but cut SLR by one per cent as part of its cerdit policy announcement on Tuesday.

The Head of Equities, Kotak Life Insurance, Mr Hemant Kanawala, said: "The market had already priced in the status quo on rate cuts and managed to rebound later in the day because of the expectation that the upcoming US Fed meeting and ECB meeting would have a positive outcome that would impact our markets positively as well."

Volatility was down with the India VIX closing at 16.01, down 3.55 per cent.

Grasim, ONGC, DLF, Sterlite and ACC were the top Nifty gainers while Bharti Airtel, Bank of Baroda, Hero Honda Motors, Jindal Steel and Reliance Infrastructure were the top laggards on the Nifty.

(This article was published on July 31, 2012)
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