Sensex Set to Snap 5-Day Losing Streak as Metals, Energy Stocks Rally

The BSE Sensex jumped over 180 points on Monday, while the Nifty marched towards the 6,750 levels as Indian markets looked set to break a five-day losing streak.

Gains were led by recent underperformers such as metals. On the Nifty, Hindalco was the top gainer, rising around 7 per cent. Jindal Steel and Power, which had fallen 14 per cent in three days, jumped around 4 per cent.

Energy stocks also found favour among investors. State-run ONGC and Mukesh Ambani-controlled Reliance Industries surged nearly 3 per cent.

Banking stocks also participated in rally today. Private lenders such as Axis Bank and ICICI Bank as well as PSU lenders such as PNB saw buying interest.

Realty major DLF recovered 1 per cent after falling 9 per cent in the previous five sessions.

The BSE Sensex has fallen over 450 points in the previous five sessions and some analysts have attributed the correction to caution ahead of the election results on May 16.

"Market is preparing for the election outcome. We can see selective position building happening in the market. We have completed a phase of correction," said Deven Choksey, managing director, KR Choksey Securities.

Although foreign investors have continued to buy cash shares, the momentum has slowed down considerably. FIIs bought shares worth Rs 387 crore on Friday, but domestic institutional investors sold shares worth Rs 406 crore.

However, some analysts have attributed recent gains to improving macroeconomic environment in the country and expect the Sensex to go up in the event of a stable government post elections. Indian stock markets are up over 6 per cent year-to-date.

Prabhat Awasthi, head of equities at Nomura told NDTV that markets have not yet factored in a bullish economic outlook, which a BJP led government can bring to the country by removing policy bottlenecks.

The BSE Sensex traded 166 points higher at 22,570, while the Nifty rose 39 points to 6,734 as of 1.45 p.m.