MUMBAI: Stock market benchmark indices Sensex and Nifty jumped 1 per cent in early trade on Thursday, led by advances in PSU banks, Services and Auto stocks as global sentiment improved after easing geopolitical trade tensions, lifting the investor sentiment.
On Thursday, the 30-share BSE Sensex climbed 774.04 points, or 0.94 per cent, to 82,683.67 in early trade. The 50-share NSE Nifty rose 233.85 points, or 0.93 per cent, to 25,391.35.
From the 30-Sensex firms, Tata Steel, Adani Ports, Asian Paints, Bharat Electronics Ltd, State Bank of India, Sun Pharmaceuticals, Kotak Mahindra Bank, Eternal, Trent, Mahindra & Mahindra and Bajaj Finserv were among the gainers.
On the other hand, ICICI Bank is trading marginally lower.
"President Donald Trump has withdrawn from his threat to 'annex Greenland by force, if necessary.' Instead, in Davos on Wednesday he said 'we have reached a framework of a future deal on Greenland.' More importantly, the message that the US would 'refrain from imposing tariffs on Europe' takes away the threat of a US- Europe trade war which was dragging the markets down.
"The consequent relief rally in the market on Thursday can be significant since there are about 2 lakh short contracts in the market and the market construct is right for short-covering," VK Vijayakumar, Chief Investment Strategist, Geojit Investments Ltd, said.
The Q3 profitability of companies have been affected by higher provision for the new labour code commitments. But the market will shrug it off since this is a one time commitment, he added.
The broader Asian markets were trading on a mixed note, with Japan's Nikkei 225 index and South Korea's Kospi index were traded higher, while Shanghai's SSE Composite index and Hong Kong's Hang Seng index quoted lower.
US markets ended higher in overnight deals on Wednesday.
Foreign institutional investors offloaded equities worth Rs 1,787.66 crore on Wednesday while Domestic Institutional Investors (DIIs) bought stocks worth Rs 4,520.47 crore, according to exchange data.
Brent crude, the global oil benchmark, rose 0.14 per cent to USD 65.33 per barrel.
Slipping below the 82,000 level, the 30-share BSE Sensex declined 270.84 points to close at 81,909.63. The 50-share NSE Nifty fell 75 points to settle at 25,157.50.