Markets recoup some losses

Indian shares rebounded on Thursday, recovering some of the losses from the previous session, led by a rally in energy stocks, as investors awaited the highly anticipated results of stress tests on certain mutual funds schemes.

The blue-chip NSE Nifty 50 index rose 0.68% to 22,146.65, while the BSE Sensex gained 0.46% to 73,097.28. They had lost 1.5% and 1.2%, respectively, in the previous session.

The broader, more domestically focused small- and midcaps climbed 3.45% and 2%, respectively, recouping some losses from Wednesday. They have lost 11.4% and 5.8%, respectively, from their record highs on 8 February, compared to a 2% rise in the Nifty.

Many market participants had attributed the broader market rally over much of 2023 and early 2024 to investors disregarding fundamentals. The country’s markets regulator on Monday referred to it as froth.

“The intention of the Securities and Exchange Board of India is absolutely fair, but the timing and the market reaction were not helpful for sentiment,” said Deven Choksey, managing director of DRChoksey Finserv.

Investors await stress test results of small- and mid-cap mutual funds, set to be disclosed by mutual fund managers from Friday, which will gauge the funds’ resilience to sudden redemption pressures.

Earlier in the day, rating agency Fitch raised its estimate for India’s economic growth for fiscal years 2024 and 2025, citing strong domestic demand.

Energy and IT indexes gained about 2% each, recovering from the previous session’s fall.

Adani group stocks, which tumbled on Wednesday, were the top Nifty 50 gainers. Adani Enterprises added 6.2%, while Adani Ports jumped 4.8%. Larsen & Toubro jumped 2% on winning orders in the Middle East.

The blue-chip Nifty 50 index rose 0.68% to 22,146.65, and the BSE Sensex gained 0.46% to 73,097.28