After losing 2.5 per cent on Monday it was recovery time for Indian indices. The Nifty recovered 0.7 per cent (34 points) to close the day at 4,812.35, while the Sensex rallied 113 points to close at 16,059.48.
Experts said that the time was still not conducive to enter the market.
“The risk to reward ratio is still not favourable as the chances of being trapped in case one punts on the direction of the market are higher,” said a Head of Research of an Indian brokerage.
Volatility was down 4.4 per cent and the India VIX closed at 27.35.
Top five gainers on the Nifty were Tata Motors, JP Associates, BPCL, Tata Steel and cairn, while Siemens, Bharti Airtel, Kotak Bank, Tata Power and ITC were the top five losers.
On the global front, rating agency Moody’s said on Monday that France could be the next to lose its AAA sovereign rating as slow economic growth and rising interest rates would hamper its efforts to rein in fiscal deficit.
Meanwhile, the US Congress’ committee looking at budget cuts of $1.2 trillion could not come to a consensus solution as the members expressed their inability to sort out their differences.