JOIN USThe total market breadth, however, was negative as second-line stocks underperformed the Sensex, reflecting absence of retail investors.
Initially, Sensex touched a low of 16,316.66 on weak Asian trend in morning deals, but bounced back sharply in line with smart recovery in Asia.
It then touched a high of 16,756.08 as European markets opened firm amid hopes that Greece's debt default may be averted and closed at 16,698.07, up 252.05 points or 1.53 per cent.
Similarly, the NSE 50-issue Nifty shot up 69.55 points or 1.41 per cent to close at 5,015.45.
Brokers also attributed the market recovery to frenzied short-coverings during the settlement of derivative contracts and rolling over of the positions to the next series.
“Recovery in European markets after initial red opening also aided the uptrend. With the expiry of September series derivatives today, volumes are expected to be lower for couple of trading sessions,” said Shanu Goel, Senior Research Analyst at Bonanza Portfolio.
Buying was so strong that a surge in food inflation failed to dampen the market sentiment. It rose to 9.13 per cent for week ended September 17, from 8.84 per cent in the previous week.
Meanwhile, as per provisional Sebi data, FIIs bought shares worth Rs 184.97 crore on Wednesday indicating renewed interest in buying.
“Markets made late surge on short-covering on the last day of September series as also in anticipation of Germany voting in favour of Greece which will have positive impact on global markets” said Kishor P Ostwal, CMD, CNI Research.
Globally, investors were expecting German law makers to approve funds for bailout of Europe's debt-laden nations. Key indices in Japan, Singapore, South Korea and Taiwan ended in the green, while China market closed in the red. Hong Kong market was closed.
Back home, 23 of the 30 Sensex scrips settled with gains, while others concluded with losses. The total market breadth on BSE was negative as 1,507 stocks closed with losses, while 1,265 ended with gains. Total turnover declined to Rs 2,272.12 crore from Rs 2,516.08 crore on Wednesday.