Indian indices ended higher on Tuesday breaking a 3 days losing streak, however they failed to hold on to morning gains. At close, the Nifty was up 55.85 points or 0.63% at 8879.10. The Nifty Bank index ended 0.5 percent lower at 17,486, nearly 700 points off the day's high of 18,175.
Market participants seemed skeptical about the longevity of the upmove. Telecom, PSU, Auto and FMCG indices were up, while PSU Banks index fell reflecting increased caution on their asset quality after IBC was postponed by a year on Sunday. Adding to the negativity was the Moodys statement that the measures announced by the government for financial institutions as part of Rs 20 trillion-economic package will help ease their asset risk, but will not fully offset the negative impact from the Covid-19 outbreak. India's non-bank lenders will face increased liquidity and solvency strains as economic activity slows due to Covid-19.
Asian markets rose in early trading Tuesday, following sharp gains on Wall Street as the U.S. economy continued to slowly reopen and drug maker Moderna announced positive early results from a potential COVID-19 vaccine.
European stocks on Tuesday weakened after a sensational rally, with caution returning as data continued to show the heavy economic price for the coronavirus lockdowns. The mood was more somber as economic data showed a surge in the U.K. claimant count and a 76% plunge in European Union car registrations in April.
Technically, markets are getting sold off on rallies reflecting weak sentiments. 8806 is the support for the Nifty while 9044 remains a resistance.