Sensex snaps 3-session losing streak, gains 110 points

Ignoring weakness in stock markets globally, the BSE Sensex snapped 3-session losing streak today and gained 110 points to close at 16,841 on buying in blue chips at lower levels, amid government comments that inflation would ease on the back of good monsoon.

A smart rise in heavyweights like Infosys, ITC, HDFC Bank, TCS, HDFC, L&T, ONGC, Coal India, HUL, Hero MotoCorp and Sun Pharma supported the Sensex.

Sectorally, IT and FMCG attracted good buying support. However, realty, auto and banking fell restricting gains.

Cues from Asian and European markets, where investors are worried over economic slowdown globally, were weak.

The Bombay Stock Exchange 30-share index, Sensex, opened higher and crossed the 17K-mark. However, it dropped to 16,708.98 in the afternoon trade after weak European opening.

Finally, it settled at 16,840.80, gaining of 109.86 points or 0.66 per cent. In last three sessions, it had fallen by nearly 400 points or 2.33 per cent.

Similarly, the broader NSE 50-issue Nifty recovered 20.80 points or 0.41 per cent to 5,056.60.

The total market breadth, however, remained negative as second-line stocks continued to reel under selling pressure.

Brokers said Finance Minister Pranab Mukherjee's comments that inflationary pressure would ease further on the back of good monsoon helped lift the sentiment somewhat, although interest sensitive stocks remained under pressure.

Inflation eased marginally to 9.22 per cent in July, from 9.44 per cent in June.

High inflation has put pressure on interest rates hitting corporate margins. The Reserve Bank has raised key interest rate 11 times since March last year to tame inflation.