Indices surge 2%, Nifty tops 5,500

Indian stock markets surged to end 2% higher on Wednesday, amid firm global cues, on broad-based buying as investors bought stocks across sectors.

The 50-share Nifty ended above the crucial psychological level of 5,500. The index ended higher by 116 points at 5,532 and the BSE benchmark index- Sensex jumped 354 points to close at 18,202 levels.

According to Somil Mehta, senior. Technical Analyst (Equity) at Sharekhan, "Short term and medium term bias remains positive and Nifty is expected to target 5650. Key support would be around 5300/5150 and resistance would be around 5500/5650."

The European markets were trading on a firm note in trades today. The DAX was up 85 points at 6,813 levels. CAC 40 was up 40 points at 3,415 and FTSE was up 23 points at 5,923 levels.

The Asian markets ended the day on a positive note. Nikkei average rallied to a six-month closing high today after the Bank of Japan (BoJ) expanded its asset buying programme the previous day. The index ended higher by 208 points at 9,260. Hang Seng advanced over 2% or 447 points to 21,365, Taiwan and Shanghai also ended higher by 1.5% and 1% each respectively.

Back home, Tata Motors was the top Sensex gainer. The Stock rallied 7% to Rs 286 on reporting 41% year-on-year (yoy) jump in consolidated net profit at Rs 3,405 crore for the quarter ended December 2011 on the back of better performance by British division Jaguar Land Rover (JLR). The company's consolidated revenues grew 44% at Rs 45,260 crore on y-o-y basis.

TCS ended up 1.8% at Rs 1,241, its lifetime high level on the National Stock Exchange (NSE).India’s largest software exporter by sales, has bagged a multi-year deal from Denmark's largest telecommunications firm TDC, reports suggest.

DLF, Tata Power, Larsen & Toubro, BHEL, Sterlite Industries and ICICI Bank also advanced 4-6% in trades today. Maruti Suzuki, HDFC Bank, Gail India, Mahindra & Mahindra, HDFC, Infosys, State bank of India, Bharti Airtel, Jindal Steel and Tata Steel were also among the star performers in today's session.

However, index heavyweight Reliance Industries was among the laggards, down 1.4% to Rs 836 in otherwise strong market, on reports that the gas output from the company’s D6 block in the Krishna-Godavari (KG) basin may be 66% lower than the initial estimate from April.

Cipla and HUL were also among the notable losers.

Interest rate sensitive sector such as realty, capital goods, banking and auto stocks were on the buyers radar on hopes that the Reserve Bank of India (RBI) may cut interest rates in March, after inflation rate based on the wholesale price index (WPI) fell to 6.55% in January, 2012, the lowest level in over two years. It was 7.47% in December, 2011, and 9.47% in January, 2011.

The BSE Realty index was the top sectoral gainer. The index surged 5% or 97 points to 2,031 levels. Capital Goods index jumped 4% or 419 points to 10,871 levels. BSE banking index- Bankex and the Auto index shut shop higher by 3.5% each.

Power, consumer durables, metal, IT, PSU, FMCG and healthcare stocks also witnessed buying.

From the capital goods stocks, Havells India, Suzlon Energy, Thermax, Lakshmi Machine Works, Praj Industries and Punj Lloyd were among the top gainers.

However, led by the losses in the Reliance Industries the BSE Oil & Gas ended marginally lower, down 0.3% to 8,747 levels.

Among other shares, Sunteck Realty was the top gainer among the realty stocks, up 19% to Rs 417. Unitech showed strength in trading session today, up 7% to Rs 32. HDIL, Sobha Developers, parsvnath Developers, Oberoi Realty and Prestige Estates were also among the top gainers from this space.

Munjal Auto Industries rallied 6% at Rs 50, its lifetime high, after reporting a net profit of Rs 11.19 crore for the third quarter ended December 2011, as compared to Rs 5.53 crore in the corresponding quarter of the previous fiscal. Net sales grew 23% at Rs 171 crore on year-on-year basis.

Great Offshore has surged 20% to Rs 127 after reporting almost five-fold jump in net profit at Rs 8.29 reported a net profit of Rs 1.83 crore in a year ago quarter.

Aptech Limited hit the upper circuit filter of 5% at Rs 93.85 after it signed an agreement with Syntea SA of Poland for acquiring 8.33% stake in the latter.

The broader markets were in line with the benchmark indices. The BSE mid-cap index ended higher by 2% or 133 points at 6,480 levels and the small-cap index jumped 92 points to 7,053 levels.

The overall market breadth was positive as 1,896 stocks advanced while 1,081 stocks declined.