Nifty Likely To Open Gap Up

Indian equities market staged a strong comeback and gained more than 2% on Thursday as investors' sentiment was lifted by upbeat global equity markets. The Sensex surged 516.53 points to 26231.19 and the Nifty rallied 157.10 points to 7948.95. The broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices rising around 2.5% each, largely driven by short covering. Meanwhile, the rupee strengthened to 66.04 compared to previous close of 66.14 a dollar, registering a gain of 10 paise.

U.S. stocks soared for the second day in a row and erasing its losses for the week, as China showed signs that measures to stabilize its economy and stock market may be taking hold. The Dow Jones Industrial Average rose 369.26 points, or 2.3%, to close at 16,654.77. The S&P 500 finished up 47.15 points, or 2.4% to 1,987.66, after posting a 49-point gain. The Nasdaq Composite climbed 115.17 points, or 2.5% at 4,812.71, after being up by as many as 121 points. As a result, for the week, the Dow is up 1.2%, the S&P is 0.9% higher, and the Nasdaq is up 2.3%.

Gross domestic product, the broadest measure of goods and services produced across the U.S., expanded 3.7% in the second quarter, the Commerce Department said Thursday, well ahead of expectations and up from an initial estimate of 2.3% growth. New applications for U.S. unemployment benefits fell by 6,000 to 271,000 in the seven days ended August 22, the first decline after four straight weekly gains.

Oil rocketed more than 10% higher on Thursday, posting its biggest one-day rally in over six years as recovering equity markets. Venezuela asked the Organization of the Petroleum Exporting Countries to hold an emergency meeting. WTI prices staged a rebound, rising 10% to USD 42.56 a barrel in New York. Brent settled up 10.3% to USD 47.56.

European stocks closed in positive territory Thursday, with the STOXX Europe 600 index gaining 3.5%. Germany's DAX, France's CAC 40 and Britain's FTSE 100 all climbed more than 3%.

Asian stocks extended their recovery into the final trading day of the week as a global rally gathered pace and the U.S. economy grew faster than expected in the second quarter. Japan’s NIKKEI 225 index advanced 2.77%. South Korea’s Kospi index gained 1.54% and Australia’s S&P/ASX 200 Index rose 0.66%. New Zealand’s NZX 50 Index added 0.67%. China's benchmark Shanghai Composite spiked 2%.

A SGX CNX Nifty Index future for September delivery was up 135 points at 8,130. Nifty is likely to open higher with a gap on first day of September series.