Market watch: Stocks rebound tracking European advances

The market eased its losses after a positive opening in European markets. Australia's higher-than-expected interest-rate cut spurred spec
ulation central banks around the world will reduce borrowing costs to cushion their economies from the credit crunch.

Bourses commenced on a strong footing following market regulator SEBI's move to lift curbs on foreign institutional investors imposed a year ago and a 50 basis points cut in cash reserve ratio by the Reserve Bank of India, buoyed the trading sentiment. However, the market lost momentum in early trade as investors sold for profits.

Indian markets are governed entirely by global cues, which is why, the might of the global liquidity crisis offset the positive measures taken by the regulatory authorities. Unless there is considerable improvement in sentiment in overseas markets, Indian markets will continue to remain volatile.

Bombay Stock Exchange's Sensex rose 1.08 per cent or 127 points to 11,929.20 after slipping to a low of 11,591.58. The high, so far, was 12,181.43.

The Nifty was up 2.46 per cent or 86.65 points at 3689. The index fell to a low of 3577.60 from a high of 3732.65 so far.

Midcaps and smallcaps also cut losses. BSE Midcap and Smallcap indices were still down 1.34 per cent and 1.54 per cent respectively.

Sectorwise, realty, power and oil & gas posted modest gains while FMCG edged lower.