New Delhi: Benchmark indices Sensex and Nifty rebounded sharply in early trade on Thursday, driven by buying in IT and banking stocks and a decline in global crude oil prices, even as Asian markets suffered heavy losses amid renewed concerns over US interest rates.
The 30-share BSE Sensex climbed 354 points to 73,157.43, while the NSE Nifty gained 96.15 points to 22,726.05.
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Tata Consultancy Services, Tech Mahindra, Infosys, ICICI Bank, Axis Bank and Bharti Airtel were among the major Sensex gainers. Bharat Electronics, Adani Ports, Trent and Power Grid were among the laggards.
Brent crude futures declined 1.60 percent to USD 104.40 per barrel, providing some relief to domestic markets.
Global markets remained under pressure after US inflation accelerated to 3.7 percent in September from 3.4 percent in August, raising expectations of another Federal Reserve rate hike in October.
"The hotter-than-expected US inflation print which spiked from 3.4 percent in August to 3.7 percent in September has increased the possibility of yet another rate hike by the Fed in October. This concern triggered big selling in the US market which led to a sharp correction of 1.88 percent in the tech-heavy Nasdaq. AI stocks bore the brunt of the selling. The fear has spread to South Korea and Japan impacting their markets in early trade today," V K Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said.
Asian markets witnessed steep declines, with South Korea's Kospi plunging nearly 8 percent and Japan's Nikkei 225 falling 5.07 percent. China's Shanghai Composite and Hong Kong's Hang Seng also traded lower.
US markets had closed in negative territory on Wednesday.
Vijayakumar said the selloff in global artificial intelligence stocks could potentially benefit Indian equities by prompting foreign investors to reconsider their allocations.
"FIIs who have been selling Indian stocks and buying AI stocks will halt this trend and under favourable conditions might even reverse it. The strength in the IT stocks following the results of HCLTech and the optimism surrounding that will hold the IT index strong," Vijayakumar added.
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However, foreign institutional selling continued, with FIIs offloading Indian equities worth Rs 1,857.44 crore on Wednesday, according to exchange data.
In the previous session, the Sensex had declined 251.89 points, or 0.34 percent, to close at 72,781.89, while the Nifty fell 99.25 points, or 0.44 percent, to settle at 22,622.70.
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