Stocks rebounded on Tuesday with the BSE Sensex surging 694 points led by metal stocks on hopes of a fresh stimulus package from China and short-covering even as investors awaited the outcome of the US presidential polls.

The benchmark indices witnessed volatility as the sentiment remained cautious ahead of the battle between Donald Trump and Kamala Harris.

Stocks recovered post noon on hectic buying in the metal counter as the sector is expected to gain from a possible stimulus by China.

US stock indexes are ticking higher Tuesday as voters head to the polls on the last day of the presidential election.

The S&P 500 was up 0.4 per cent in early trading, inching closer to its record set last month.

The Dow Jones Industrial Average was up 66 points, or 0.2 per cent, as of 9.35 am Eastern time, and the Nasdaq composite was 0.6 per cent higher.

“The (Indian) markets witnessed a remarkableturnaround towards the closing hours as value buying in banking stocks along with gains in metals and oil and gas stocks aided broadmarket recovery,” Prashanth Tapse, senior VP (Research), Mehta Equities Ltd, said.

“Optimism across Asian and European indices ahead of the US election outcome boosted local traders’ confidence, although medium-term outlook still looks hazy due to scepticism over further rate cut by the Fed and subdued corporate earnings,” he said.

At the forex markets, the rupee closed sideways at 84.11 against the dollar after hitting an all-time low of 84.13. This came on account of continued withdrawal from the FIIs in the equity markets. However, support from the Reserve Bank of India (RBI) prevented a huge fall in the value of the domestic currency.

“Market participants are closely monitoring FII activity, as any significant buying or selling could influence the rupee’s movement, especially with the upcoming US election outcome,” Jateen Trivedi, VP research analyst — commodity and currency, LKP Securities said.