Following a steep decline on Monday, the domestic benchmark indices saw a strong recovery driven by purchasing activity in IT companies and automaker Bajaj Auto. India’s volatility index, VIX, decreased by 4%. With the exception of media pack, which had a steep decrease due to ZEE’s potential cancellation of its merger with Sony, all other sectoral indices saw advances in trading.
“Short positions are increasing while long holdings are gradually decreasing. This brief increase is based on bearish predictions that it will be difficult to maintain the current high valuations and that certain triggers can cause abrupt drops. Given that global cues have once again turned positive following a rise in the US market, this expectation need not come true. The domestic cues appear promising. Chief Investment Strategist at Geojit Financial Services Dr. V K Vijayakumar suggested that the buy on dips approach would be effective once more and result in some short covering.
Trade highlights include:
Today is Jyoti CNC Automation’s IPO opening.
ZED drops 10% on rumours that the Sony merger may not go through.
Bajaj Auto increases its repurchase plan by 4%.