Meanwhile, reports that the government has lined up plans to divest stake in at least seven PSUs in the next 10 months may improve sentiment. The proposed plan is in addition to the two PSUs for which the IPO process has already been completed or is scheduled.
On Wall Street, stocks saw notable strength on Tuesday, as better than expected results from big retailers more than offset disappointing economic reports. A report from the Commerce Department showed an unexpected decrease in housing starts in the month of July and separately the Labor Department revealed that producer prices dropped 0.9 percent in July following a 1.8 percent increase in the previous month. The Dow Jones Industrial Average closed up 0.9%, the Nasdaq Composite advanced 1.3% and the S&P 500 index rose 1.01%.
The Indian ADRs also closed higher across the board. Satyam Computers soared 5.24%, Sterlite Industries, ICICI Bank, Reddy's Laboratories and HDFC Bank rallied over 3% each, Infosys rose 0.71%, Wipro gained 0.55% and MTNL edged up 0.27%.
Crude oil futures rose more than 3% to close at $69.19 a barrel on Tuesday, as recovering global equities boosted optimism about the economy and energy demand. In Asian trading on Wednesday, crude oil rose further towards $70 a barrel after data from the American Petroleum Institute showed a surprise 6.1 million barrel draw in U.S. oil inventories.
After a steep loss in the previous session, the rupee rose 0.4 percent to Rs.48.78/79 against the dollar on Tuesday, as investors squared off their positions ahead of a market holiday on Wednesday and stocks bounced back sharply on shot covering.
On Tuesday, considerable amount of short covering after a steep loss in the previous session and selective buying in battered index heavy weights at lower levels amid some improvement in global investor sentiment helped the Indian market bounce back sharply. While the BSE Sensex finished at 15,035, up 250 points or 1.69%, the S&P CNX Nifty rose 71 points to 4,459 and the BSE mid-cap and the small-cap indexes rallied over 2% each. The market breadth on the BSE was extremely positive, as gainers outnumbered losers by 1721 to 906.
Stocks to Watch
In corporate news, Tata Tea received its board approval to sell its entire holding of 24.52 percent in Rallis India to Tata Chemicals at a price not exceeding Rs.850 per share.
Financial Technologies India joined the STAC Benchmark CouncilTM to help define industry standard performance metrics for trading technology solutions.
In a move which will have wider ramifications, the Delhi High Court on Tuesday dismissed German drug major Bayer Healthcare's attempt to stop the drug regulator from allowing Cipla to produce and sell the generic version of Bayer's patented anti-cancer drug Nexavar
Unitech Wireless, a joint venture of Norway's Telenor Group and property developer Unitech, raised a Rs.5,000 crore bridge loan from State Bank of India to fund the roll-out of its operations in India.
Domestic airlines will have to wait for at least three months before any reduction in jet fuel prices, civil aviation minister Praful Patel was reported to have told in an editorial roundtable organized by the Hindustan Times.
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