Scrips sizzle as bulls go on rampage on bourses

Also a rally in world stocks triggered by reports of European policy makers considering new plans to support Euro zone struggling with debt, further aided the surge on the domestic bourses.

All 13 sectoral indices on the BSE edged higher.  The bellwether index of BSE commenced the day on an upbeat note after a rally in Asian markets on expectations that European officials would expand the European Financial Stability Facility to bail out debt ridden countries in the Euro-zone.

The Sensex jumped 472.93 points or 2.95 per cent to settle at 16,524.03 this day, which is its highest closing level since September 21, 2011. The index jumped 500.55 points at the day’s high in late trade and rose 231.64 points at the day's low in early trade. The 50-unit S&P CNX Nifty at NSE surged 135.85 points or 2.81 per cent to settle at 4,971.25, its highest closing level since September 21, 2011. The Nifty hit a high of 4,982.95 in intraday trade.

From broader markets, BSE Mid-Cap index rose 1.6 per cent and BSE Small-Cap index gained 1.36 per cent. Bourses in Europe also jumped during opening trades, helping the Sensex touch a high of 16,552 in the afternoon.

Analysts maintain that the current rally was just a relief rally and Nifty would face resistance around 5,000 levels. “For the week, if the index sustains above 4,870, it is positive, but I expect this bounce to fade around 5,000-5,025 level,” said Sahaj Agrawal, Associate Vice President - Derivatives — Kotak Securities.

The market breadth, indicating the overall health of the market, was strong with as many as 1,877 shares on BSE rose and 953 shares fell, while a total of 106 shares remained unchanged. The total turnover on BSE amounted to Rs 2365 crore, lower than Rs 2923 crore on September 26, 2011.

The near-term major trigger for the market will be Q2 September 2011 results as investors will closely watch the management commentary at the time of announcement of Q2 results. Besides, the advance tax payment by top 100 firms rose a modest 9.9 per cent in Q2 September 2011 from a year ago against 19 per cent growth in Q1 June 2011, suggesting corporate profit growth is likely to be muted in the second quarter.

The market had tumbled recently over fears of weak Q2 results and data showing heavy selling by FIIs adversely hitting investor sentiment. Sensex had slumped 1,048.18 points or 6.12 per cent in four trading sessions to settle at 16,051.10 on Monday last.