Snapping its two-day falling streak, the benchmark Sensex on Friday recovered over 205 points in opening trade on revival of buying by funds, triggered by overnight gains at the US markets amid easing liquidity conditions in the market.
The 30-share index, which had lost nearly 900 points in the past two sessions, recovered by 205.44 points, or 1.94 per cent, at 10,786.93 on renewed buying in the stocks of banking, capital goods and realty sectors.
The wide-based National Stock Exchange's Nifty rose by 66.65 points, or nearly 2 per cent, at 3,335.95 points.
Market men said overnight gains at the US stock markets and easing liquidity conditions in the markets after the RBI announced a cut of 100 basis points in the CRR to release extra 40,000 crore into the system helped sentiments improve.
Easing inflation, which fell to 11.44 per cent for the week ended October 4 from 11.80 per cent a week ago also had a positive impact.
Covering up of short positions by speculators in view of some improvement in the behaviour of market also supported the recovery trend in stock prices, they said.
Major gainers in the opening trade were BHEL, up by Rs 35.50 at Rs 1348.50, Larsen and Toubro by Rs 24.75 at Rs 850.50, Reliance Industries by Rs 26.30 at Rs 1,423.55, Reliance Infra up Rs 16.60 at Rs 574 and Satyam Computers by Rs 3.60 at Rs 276.65. Overnight on Wall Street, the US Dow Jones Industrial Average closed higher 4.68 per cent.
Asian stock markets were also trading in the positive territory with Japan's Nikkei gaining 2.33 per cent in opening trade today.