InvestorQ : What explains the sharp bounce in the markets on Tuesday? Was it fresh buying or was it more of short covering?
Dilmini Mercia made post

What explains the sharp bounce in the markets on Tuesday? Was it fresh buying or was it more of short covering?

Answer
image
Dawn Cherian answered.
1 month ago
Follow

If one looks at the performance of the market on Tuesday, it may look like a normal bullish day. But two stand out for the performance of the index on Tuesday. Firstly, it came on the back of a sharp correction on Monday. Secondly, it comes after opening sharply lower on Tuesday, which is what makes the bounce more impressive.

What needs to be noted is that the Sensex started deep in the negative on Tuesday. However, from the lows the Sensex recovered nearly 895 points in the last couple of hours to close the day 453 points higher at 46,007 levels. This rally was led partially by short covering, partly via fresh buying and partly via F&O action in the markets.

The rally got triggered after the CEO of BionTech expressed confidence that its current COVID vaccine would also work with the mutated UK virus with minor tweaks. Even the Nifty touched a low of 13,192 but bounced back to13,466. The IT index hit a record high on Tuesday, as HCL Tech, Tech Mahindra and Infosys were the big gainers for the day.

0 Views