The BSE Sensex and NSE Nifty, India’s benchmark equity indices, witnessed a sharp recovery from a fall on Friday. The Sensex gained 1,508 points and the Nifty rose by 452 points in intraday trade. It was near a 5 per cent recovery from the day’s low.

The Sensex ended the day with gains of 242 points or 0.72 per cent at 33,780. The Nifty index rose 70 points or 0.72 per cent to close at 9,972. The Bank Nifty index was up 129 points or 0.63 per cent at 20,654.

The recovery was due to the US markets as index futures of both the Dow and Nasdaq were trading higher by nearly 2 per cent when Indian markets were open. The recovery for the Bank Nifty index was a stunning 1,221 points, to close at 20,654.

The Federal Reserve has decided to keep interest rates near zero till 2022, which means an abundance of liquidity in the global financial markets, which should cushion equity markets from crashing, experts say.

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The market recovery on Friday was on the back of massive buying in the cash segment by domestic institutional investors (DIIs) and a bout of short covering in the derivative segment by both domestic and foreign traders. DIIs bought stocks worth ₹1,945 crore in the cash segment. Foreign portfolio investors (FPIs) sold stocks worth ₹1,311 crore in the cash segment. Derivative trading data was not put out by stock exchanges till the time of going to press.

“A technical sell-off for the Indian markets that was impending after the recent swift rally is now a thing of the past. It factored in even the worst-case scenario for the Sensex and Nifty. The bull run may go on now,” said Rohit Srivastava, strategist, Indiacharts.

“Today’s recovery indicates that the Nifty and Sensex could rally more on a near-term basis,” said Arun Kumar, Market Strategist, Reliance Securities.

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