Mumbai: Coal sector reforms fuelled a rally in power, metal and banking stocks lifting Sensex on Tuesday by 146 points to end at over one-week high and Nifty by 48 points to regain the 7,900-mark.
Persistent buying coupled with renewed foreign capital inflows amid higher opening in European markets also boosted the market sentiment, traders said.
Shares of Realty, Power, Metal, Capital Goods, Banking and Consumer Durables sectors firmed up sharply.
In a major move towards energy sector reforms, the Cabinet yesterday recommended promulgation of an Ordinance to facilitate e-auction of coal blocks for private companies for captive use and allot mines directly to state and central PSUs.
The BSE Sensex resumed higher at 26,552.45 and firmed up further to a high of 26,615.41 before concluding the day at 26,575.65 -- a gain of 145.80 points or 0.55 percent.
It has gained by 576.31 points or 2.22 percent in three days and closed at its highest level since 26,637.28 on October 9.
The CNX 50-share Nifty also rose by 48.35 points or 0.61 percent to 7,927.75.
"Sentiments were up-beat on report that FIIs were net buyers on Monday. Besides, the announcement by the government to cap the subsidy on domestic gas cylinders and to take up ordinance route to resolve issues arising out of the cancellation of coal blocks further aided positivity," said Jayant Manglik, President-retail distribution, Religare Securities.
In a sign of renewed capital inflows after a spate of selling recently, provisional data released by stock exchanges showed that Foreign Portfolio Investors (FPIs) bought shares worth a net Rs 1,040.08 crore yesterday.
Asian stocks ended mixed as China's economy in the third quarter grew at its slowest pace in five years.
Benchmark indices in Hong Kong and Singapore moved up by 0.08 percent to 0.68 percent while China, Japan, South korea and Taiwan dropped by 0.10 percent to 2.03 percent.
European stocks were trading higher in their afternoon trade after a round of solid earnings reports. Key indices in France, Germany and UK rose by 0.57 percent to 1.29 percent.
Jignesh Chaudhary, Head Of Research, Veracity Broking Services said: "Local equities traded volatile and eventually closed on the higher side. Overall, market sentiments are positive after government announced more reforms and recommended e-auction of coal blocks".
In broader markets, Financial Technologies (FTIL) stock tumbled 20 percent after government ordered merger of crisis-ridden NSEL with holding firm, FTIL.
Twenty two scrips out of the 30-share Sensex pack ended higher while eight counters finished lower.
Major gainers were Gail India (4.43 percent), Sesa (4.42 percent), BHEL (4.28 percent), Wipro (3.04 percent), NTPC (2.75 percent), ICICI Bank (2.64 percent), Maruti (2.30 percent), Bharti Airtel (2.28 percent), Hero Motocorp (1.98 percent) and HUL (1.68 percent).
Tata Motors (1.46 percent), Axis Bank (1.27 percent), Tata Steel (1.26 percent), Hindlaco (1.23 percent), Tata Power (1.21 percent) and Larsen & Toubro (1.14 percent) also logged modest gains.
However, ONGC dropped by 2.57 percent, M&M 2.45 percent and Coal India 1.57 percent among laggards in Sensex.
Among the S&P BSE sectoral indices, Realty rose by 2.63 percent, followed by Power 2.55 percent, Metal 1.71 percent, Capital Goods 1.38 percent, Bankex 1.20 per cent and Consumer Durables 1.18 per cent.
Market breadth remained positive as 1,494 stocks ended with gains while 1,332 finished lower. The total turnover fell to Rs 3,112.63 crore from Rs 3,407.74 crore yesterday.
