Market rings in New Year with style, Sensex soars 339 pts

Market

Stocks: The market ushered in the New Year with a bang as both the key indices, Sensex and Nifty, continued their bull run for the second week in a row and attained their highest levels in nearly two years on the back of US budget deal and positive growth in service and manufacturing sectors in the country. The market resumed trading on a cautious note after investors decided to play safe as US lawmakers were trying to reach a pact to avoid the 'fiscal cliff' of over USD 600 billion in spending cuts and tax hikes.

The US Senate approved an agreement on Tuesday to help the world's biggest economy avert the fiscal cliff. The deal boosted the world stock markets, including the Indian bourses.

The proposal would extend tax rates on annual household income under USD 4,50,000 and postpone automatic spending cuts for two months.

Barring FMCG index, which closed in the red, other sectoral indices gained between 0.96 per cent and 5.19 per cent during the week with realty, PSU, oil & gas and consumer durable leading the pack.

The Bombay Stock Exchange 30-share barometer showed a weak trend on the first day of the week, but then went on a gaining spree to settle up 339.24 points, or 1.74 per cent, at 19,784.08, a level not seen since January 6, 2011.

Similarly, the wide-based S&P CNX Nifty of the NSE spurted by 107.80 points, or 1.82 per cent, to settle above 6,000 level for the first time after two years at 6,016.15.

State-run oil companies gained on hopes that a proposed revision in the Government's pricing formula would boost gas prices. Additionally, Oil Minister M Veerappa Moily has allowed RIL and Cairn India to explore for oil and gas within the producing fields subject to certain conditions.

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