The BSE benchmark Sensex on Monday jumped by 143 points to close at a fresh 30-month high on strong buying support from FIIs in interest rate-sensitive realty, auto and banking stocks, even as RIL fell for the fourth day to end below the Rs 1,000 level.
Amid positive cues from Asian markets, which shrugged off disappointing US jobs data, the 30-share index of the Bombay Stock Exchange opened on a positive note and accelerated in the afternoon session after European bourses opened higher.
The Sensex ended the day higher by 143.51, or 0.79 per cent, at 18,287.50, the highest closing level since February 2, 2008.
Analysts, however, said some profit-booking in the coming days cannot be ruled out.
They also said a slew of factors improved the market sentiment. Monsoon rains were 16 per cent above normal in the week ended August 4, 2010. In addition, record overall auto sales in July were promising, they pointed out. However, the real mover of the market was heavy buying by foreign institutional investors (FIIs).
It is widely expected that good monsoon rains would lead to better farm production, which would ease supply pressure on inflation.
Affirming their faith in the India growth story, foreign fund houses have parked Rs 51,185 crore (USD 11.1 billion) in domestic stock markets so far in 2010, more than half of their record investment made in 2009. In the past week alone, FIIs infused Rs 5,590 crore into local stocks, as per Sebi data.
"FIIs are bullish about emerging nations, especially the Indian economy, and are parking money as they see a long-term gain here. The trend is likely to continue for coming period," Unicon Financial CEO Gajendra Nagpal said.
Barring the oil & gas and the pharma index, all the other BSE sectoral indices ended in the green.
Realty major DLF, which had lost about 1 per cent on Friday, surged nearly 4 per cent to emerge as the top performer in the Sensex.
Banking stocks were also in hot demand. The country's top private sector lender, ICICI Bank, climbed 3 per cent, HDFC 1.52 per cent and SBI 1.12 per cent.