S&P assurance calms mkt; Sensex recoups 400 pts

With a pick-up in short covering, Sensex has managed to see a meaningful recovery of 400 points from the day's low point. Rating agency S&P's statement that there would be no immediate impact of US rating cut on India provided the much-needed relief. This was in contrast to the talks doing the rounds yesterday that S&P downgrade may hit other countries and companies.

The 30-share BSE Sensex was trading at 16,843, down 147 points after 400 points recovery from day's low of 16,432. The 50-share NSE Nifty was trading down 43 points at 5,075.

Short covering impact: Sterlite Industries and DLF gained 2%. SBI, BHEL, Kotak Mahindra Bank and IDFC went up 0.5%.

Fresh longs were seen in ONGC, M&M, Baja Auto and Ambuja Cements, which moved up 1-3%.

Asian markets too recovered 3-5% from day's low. China's Shanghai, which fell 2.5% in early trade, was flat. Kospi, which tumbled 9%, lost just 3.4%.

Advance:decline ratio, which was 1:15 in early trade, improved to 1:4.

At 11:21 hours IST: Market recovers from day's low; IT down 3%

The Indian equity market was trading off the day