The BSE Sensex and the Nifty rebounded on Wednesday from a seven-month closing low to post their first gain in six sessions as technology shares such as Infosys advanced ahead of their quarterly results while blue-chips such as Larsen & Toubro recovered.
Indexes posted their biggest daily gain in around a month, helped as well by global shares that edged up to their highest level in a week after Chinese trade data pointed to a steady recovery in the world's second largest economy.
However, shares are expected to continue to be weighed down by concerns about foreign investor sales after they sold shares worth a net 6.62 billion rupees on Tuesday, bringing their total to 17.25 billion rupees in the previous five sessions, according to provisional exchange data.
"Valuations are driving the market, but there are still no significant buyers, and on top of that, foreign investors are still selling," said Vivek Mahajan, head of research at Aditya Birla Money.
"It may seem like a buy-on-dips market," he added. "Way more conviction is required."
The BSE Sensex rose 1.03 percent, or 187.97 points, to close at 18,414.45, posting its biggest daily gain since March 14. The index had fallen 4.3 percent over the previous five sessions.
The Nifty rose 1.16 percent, or 63.60 points, to close at 5,558.70,posting its biggest daily gain since March 8 after losing 4.4 percent over the prior five sessions.
Software services exporters gained as previous losses were seen overdone. Infosys Ltd
HCL Technologies Ltd
Other blue-chips also gained. Larsen & Toubro Ltd
Reliance Communications this month inked a 12-billion-rupee deal to share its fibre optic network with the telecom unit of Reliance Industries Ltd
Tata Motors Ltd
However, Sun Pharmaceutical Industries Ltd
(Additional Reporting by Abhishek Vishnoi)