Indian shares rose 0.4 percent on Thursday, recovering from intra-day lows on bargain hunting, as global central banks moved to calm turbulent financial markets through joint liquidity action. The BSE benchmark 30-share Sensex index rose 52.7 points to 13,315.6, snapping seven consecutive days of losses.
Banking and finance stocks led to the recovery. The Sensex had plunged over five percent to a day's low of 12,558.16 in early dealings on reports of further financial turmoil in the United States. "Bargain hunting by local funds led to a recovery. But there is still a lot of uncertainty among the global markets, said Atul Hatwar, dealer with brokerage Crosseas Securities.
Investors were spooked on the Wall Street Journal and New York Times reports that investment bank Morgan Stanley, whose stock fell to its lowest level since 1998, was mulling a merger with Wachovia, a US commercial bank. The markets now await inflation data due late Thursday, which is riding at near 13-year-highs.