Sensex, Nifty rebound over 1%! Key factors that fuelled the rally

Domestic shares rose on Thursday and stocks across the board rallied as risk appetite improved globally on the back of upbeat technology earnings in the US, while Hindustan Unilever rose to a nine-week high following quarterly results.

The 30-share pack Sensex advanced, in line with peers across Asia, rising 701.67 points or 1.23 per cent to 57,521.06.

Its broader peer Nifty50 also advanced 206.65 points or 1.21 per cent higher to reclaim the 17,200 mark on Reliance, HUL, Infosys boost. However, Nifty has declined in 5 out of last 6 series, while Nifty Bank closed flat.

HUL, Asian Paints, HDFC Life, Power Grid finished strong while Bharti Airtel, M&M, HCL Tech settled with cuts in a strong session

FMCG, power, auto and capital goods added 1-2 per cent each while both midcap and smallcap indices also ended in the green.

Here are the top factors that fuelled today’s rally:

US futures, European stocks rally
S&P500 futures were hinting at a gap-up rally for US stocks later in the day. The S&P 500 June futures were up 1.57 per cent at 4,246. European shares too were trading firm, with French CAC 40 rallying 1.7 per cent, German DAX climbing 1.65 per cent and UK's FTSE 100 jumping 0.8 per cent. The Euro Stoxx 50, which captures top 50 euro zone firms, was up 1.7 per cent at 3,800.

The domestic market performance was more or less in line with the global trend.

Expiry of April series F&O contracts
Thursday was also the day for expiry of April series futures and options contracts. Analysts were expecting the Nifty50 to see immediate hurdle at 17,100-17,230 levels.

Sameet Chavan of Angel One was expecting a dull market movement on the expiry day. In his pre-open note however, he had said: "Only if we see the upper boundary of the range is taken out, a lot of individual stocks would start to give sharp rebounds. Traders are advised to keep focusing on stocks that may still outperform the benchmark index," he had said.

Nifty50 was trading at 17,230 at the time of writing this note.

Buying in index heavyweights
While largecaps were mainly trading higher, the broader advance-decline ratio in fact was tilted towards the bears. Sensex heavyweights such as Reliance Industries, Infosys, Hindustan Unilever, ICICI Bank and L&T, along with Asian Paints, contributed over 500 points positively to the Sensex rise. Overall, some 1,596 stocks advanced on BSE against 1,724 shares that declined.

(With inputs from agencies.)