Sensex, Nifty gain for second straight session led by banks

Indian equity benchmarks ended higher on Tuesday, as gains in banking stocks helped the indexes reverse course in the final hour of trading after having spent the day under pressure due to some tepid earnings reports and persistent foreign selling.

The NSE Nifty 50 rose 0.52 per cent to 24,466.85, while BSE Sensex gained 0.45 per cent to 80,369.03. They had dropped about 0.7 per cent each earlier before the U-turn sparked a second straight day of gains. They snapped a six-session losing streak on Monday.

"The drop earlier in the session after a rebound on Monday indicates that buyers and sellers remain indecisive about the short-term market trend," said Akshay Chinchalkar, head of research at Axis Securities.

"Volatility is expected to rise in the next few sessions with all the upcoming event-related risks such as US non-farm payrolls on Friday and US presidential elections on Nov. 5."

The Nifty 50 has dropped about 7 per cent from a record high hit on September 27, in part as foreign investors have pulled money from stocks for the past 21 sessions.

On the day, the more domestically-focused small- and mid-caps rose 0.8 per cent and 0.9 per cent, respectively.

The heavyweight financials rose 2.1 per cent, while banks also gained 2.1 per cent.

ICICI Bank , the third-heaviest Nifty member, advanced 3 per cent, leading the market for a second straight session after its quarterly profit beat estimates.

Federal Bank climbed 8.5 per cent after posting a bigger quarterly profit. Indian Bank also posted a higher profit, leading the stock 5.4 per cent higher, adding to its 10.6 per cent jump in the previous session.

On the flip side, Maruti Suzuki slid 3.8 per cent after posting its slowest quarterly revenue growth in nearly three years. That dragged auto stocks down 1.6 per cent.

Bharti Airtel lost 1.6 per cent after the telecom carrier reported a smaller-than-expected second-quarter profit.

State-owned refiner Indian Oil lost 2 per cent after posting a smaller September-quarter profit.