Inching closer to its record levels, the Bombay Stock Exchange benchmark Sensex on Wednesday rose to three-week high by adding 120 points on improved corporate earnings and surging inflows from overseas funds.
The Sensex moved up 120.05 points to 20,465.74, advancing closer to its all-time high of 20,873.33 set on January 8, 2008. It touched intra-day high of 20,538.80.
Marketmen said the benchmark continues to be this year's best performer among the world's leading markets on steady inflow of quarterly earnings by blue-chip firms.
They said Wednesday's sentiment was also bolstered by the Reserve Bank of India saying that chance of further policy tightening in the "immediate future is relatively low". On Tuesday, RBI had announced sixth increase this year in its lending and borrowing rates by 25 basis points.
The broad-based National Stock Exchange index Nifty spurted by 41.50 points to 6,160.50 and touched a high of 6,182.50 points backed by a rise in stocks in metal, auto and banking segments.
A firming trend in the Asian region and higher opening in Europe this afternoon were a supporting factor.
In the 30-BSE index components, 20 stocks closed higher and nine ended in the negative zone, while DLF Ltd remained unchanged.
The sentiment was positively influenced by strong second quarter earnings by companies such as Fortis Healthcare, ONGC and Neyveli Lignight.
Further, it took cues from emerging-market index, where the benchmark climbed to its highest level in more than two years, as investors bet the prospects of fresh stimulus from the US Fed. The MSCI Emerging Markets Index gained 0.6 per cent to 1,130.96, its highest close since June 18, 2008.
The metal sector index gained the most by rising 1.74 per cent to 17,112.13, followed by auto sector index by 1.26 per cent to 10,077.25. Banking index rose by 1.10 per cent to 14,682.20 and consumer durable index by 0.99 to 6,960.24.