Nifty ends above 7100, Sensex gains 190 pts; auto, pharma gain

Moneycontrol Bureau Bulls seem to have got excited only in last hour of trade today. Sluggish throughout the day, the market reversed losses to end in green on Wednesday. The Nifty was below 7100 but a late buying pushed it to end at 7108.45 up 60.20 points or 0.8 percent. The Sensex closed up 189.90 points or 0.8 percent  at 23381.9.

However, Ridham Desai of Morgan Stanley says recovery on Dalal Street will not happen anytime soon but stops short of saying that India is in a bear market.  Recent market moves can be called a 'brutal correction' and it is in a more deep correction phase rather than a bear market, he says. Desai, of course agrees that the sentiment is looking rotten. However, he adds that whatever India is facing on the markets' front is more global and not India-specific.

Markets in Australia, Japan, and South Korea closed down after a choppy trading session.

Oil prices rose as efforts led by Russia and Saudi Arabia to broker a deal to freeze production levels and ease a global glut turned to Iran, which signalled a tough line. Iranian Oil Minister Bijan Zanganeh is meeting with his counterparts from Venezuela, Iraq and Qatar in Tehran. An Iranian official earlier said Iran would continue increasing its crude output until it reached levels seen before the imposition of international sanctions.

Fears of the government tweaking the definition of long term capital gains tax in the upcoming Budget have been keeping the market on the edge for sometime now. However, tax gurus feel that it is unlikely that the government will raise the time frame of long-term capital gains tax to three years from the current one year given the market scenario.

Recent reports have suggested that the government is considering whether to change the definition of 'long term' from one year to three years, thus ensuring that investors don't exit till three years unless willing to pay tax. Dinesh Kanabar of Dhruva advisors feels that it could have an adverse impact on the government's revenue.

Auto, capital goods, FMCG, pharma, IT and OIL & Gas stocks made a strong comeback after struggling through the day. BSE Auto index was up 1 percent, with big gainers like Tata Motors, Bajaj Auto and Maruti. Adani Ports, Dr Reddy's Labs, Sun Pharma and Tata Steel were top gainers in the Sensex.

Shares of Just Dial surged 18 percent intraday as the company is buying back 10,61,499 equity shares of Rs 10 each at a price of Rs 1550. The buyback offer will open on February 25, 2016 and the same will close on March 10, 2016.

ICICI Bank, Coal India, Lupin, Cipla and Axis Bank were top losers in the Sensex.