With a positive opening this morning, the bourses kept up the momentum, and traded firm through the day, shrugging off Asian power-house Nikkei's near-2% drop in value on Wednesday, and a weak opening at the European markets.
At close, both the benchmark indices clocked in robust gains; the Nifty gained 66 points at 5,480, while the Sensex ended off the day's high at 18,206 up 218 points.
In the process, the BSE benchmark logged a total gain of 367 points over the past two trading days.
The Sensex, which dipped briefly soon after its opening to its intra-day low of 17,950, recouped its losses soon after, and was seen trading in a positive belt ever since.
Near to its close, the BSE benchmark touched its intra-day high of 18,218, and wound-up the day by consolidating its day's gains.
Pulling the Sensex higher was banking heavyweight ICICI Bank, which alone accounted for a gain of 54 points on the Sensex.
Cipla at Rs 301 up 4%, was the top gainer on the Sensex, followed by ICICI Bank at Rs 1,041 also up 4% and Jaiprakash Associates at Rs 88 up 3%.
Conversely, auto stock Mahindra & Mahindra at Rs 646 and Jindal Steel at Rs 656, both down 1%, led the Sensex losers chart, while IT stock TCS saw a decline of 0.5% at Rs 1,064.
The Mid-cap and Small-cap indices, which moved in line with the benchmark, were quoting at 6,604 and 7,868, up 0.9% and 0.7% respectively.
Media house Deccan Chronicle was the highest gainer in the mid-cap space at Rs 78 up 16%, followed by Glodyne Technologies at Rs 433 up 12% and Hindustan Oil at Rs 195 up 10%.
On the small-cap chart, Dion Global Soultions was the top gainer at Rs 54, touching its upper circuit at 20%, while Zee Learning at Rs 23 up 15% and AP Paper at Rs 179 up 12% were the significant gainers.
Saibal Ghosh, CIO, Aegon Religare Life Insurance, said, "I do not expect any immediate multiple expansion in the equity market as the margin pressures will continue.
Apart from the global turmoil, political issues on the domestic front and investment cycle recovery, we are currently dealing with earning risks," when asked about his outlook on the markets.
Realty stocks gained on the back of the tabling of the Banking Amendment Bill. The Realty index was up 2% at 2,119.
Major gainers in this space were Indiabulls Real Estate at Rs 113 up 5%, Godrej Properties at Rs 641 up 4% and HDIL at Rs 158 up 3%.
Banking stocks were in the limelight today, as investors stocked up financials after the Banking Amendment Bill was tabled in the Parliament yesterday, post-market hours.
If approved, the move, seen as a major banking sector reform, would require the removal of a 10% cap on voting rights for shareholders in private banks, and equip the RBI with more regulatory authority.
Also, the Bill would also empower nationalised banks to tap the capital markets for raising funds for business expansion, and developing newer businesses.
Bank merger and acquisiton activity will be freed from the red-tape associated with the Competition Commission of India, and will be monitored by the RBI instead.
The Bankex was up nearly 2% at 12,463, driven by Sensex heavyweight ICICI BAnk up 4%, IndusInd Bank at Rs 254 also up 4%, and Federal Bank at Rs 383 up 3%.
After the Delhi government announced last evening it would be levying an extra 25% tax on diesel-run vehicles, auto stocks were dumped because of concerns auto makers may have hike prices, which may, in turn, affect sales numbers.
Also, rising input costs and interest rates, along with rising fuel prices, did not bode well for the auto sector today. The index was flat at 8,598. Losing stocks in this space were Mahindra & Mahindra at Rs 646 down 1% and Bajaj Auto at Rs 1,359 down 0.2%.
The Consumer Durables index ended as the laggard on the sectoral chart, flat at 5,809. With 1,650 advancing stocks versus 1,194 declining stocks, the market breadth remained fairly positive.
In the east, the Nikkei declined 2% to 9,449 on Wednesday, as an earthquake hit the north-eastern region of the country close to the site of the Fukushima nuclear plant, and government estimates of the damage caused by the devestating March 11 earthquake and tsunami were pegged at approximately $185-$308 billion dampened investor sentiment.
The Hang Seng at 22,825 and the Seoul Composite at 2,012 were the other major indices to close in the red. China's Shanghai Composite advanced 1% at 2,949, while Singapore's Straits Times closed at 3,022 up 0.7% and the Taiwan Weighted ended up 0.4% at 8,545.
Major European indices were quoting positive figures, as France's CAC 40 advanced 0.6% at 3,914, Germany's DAX was at 6,793 up 0.2% and the UK's FTSE 100 at 5,790 up 0.5%.
