Nifty bounced back on strong cues from Wall Street

The Nifty bounced back on Wednesday as strong overnight cues from Wall Street and a dark shade of green across Asia forced traders to cover their short positions on leading blue chips on Dalaal Street. All 18 major sectors posted gains at least in the first 20 minutes of trade.

The Nifty surged 123 points, or 1.6 percent, to 7,805 points in initial deals.No wonder then that the Advance-Decline Ratio was 48/2 on the Index. However, it was the weaker stocks that lead the gainers list. GAIL, Yes Bank, BHEL, Tata Steel and Axis Bank, where shorts are among the highest rose the maximum on the Index. Cairn, Hindustan Unilever, BPCL and Tech Mahindra posted modest losses.

Banks dominated trade on Wednesday, just as the previous day. Axis, Yes, ICICI and State Bank of India were the top four traded counters on the NSE. All four showed a tick of green.

Not one major index was in the red as shorts were being covered across the board. As a consequence, the CNX 100, CNX 200, CNX 500, Midcap and small cap indices showed smart gains on the exchange.

The mood was equally joyful on the Bombay Stock Exchange, where the Sensex jumped 375 points, or 1.5 percent, to 25,693 points, its second day of gains. The Advance-Decline Ratio was a robust 29/1 and Vedanta, Infosys, HDFC, Hindalco and Tata Steel were the top gainers on the Index. GAIL was the lone loser on the Sensex where ITC , SBI and Axis Bank were the top traded stocks.

The Bulls deepened their presence on the Futures and options market where 158 futures rose compared with just 3 that lost ground. Cairn, Bharat Forge, Ashok Leyland and LIC housing Finance were the top gaining futures, while GAIL and Sun TV fell below their Tuesday'sclose. Strong short covering was seen in the metals, realty and automobile sectors in the derivatives space.

The broader market saw the bulls increasing their dominance with 1,413 shares gaining versus 216 that fell.

(Image credits: Indiatimes)