The Bombay Stock Exchange 30-share barometer extended its weekly rally to ninth straight week, gaining another 473 points but failed to sustain higher levels in the week under review.
This makes the longest weekly rally since July 24, 2006 with a rise of 42.65 per cent, one of the biggest weekly percentage wise gains in the BSE history.
After a long weekend, the market started with a big bang as the sensex zoomed 731.50 points on Monday, taking the Sensex past 12K level for the first time since October 2008.
In the week to May 8, the Sensex hit the intra-trade high of 12,272.10 on Wednesday before ending the week at 11,876.43, a net rise of 473.18 points or 4.15 per cent over its previous weekend's close.
In the longest weekly winning streak, the BSE bellwether registered a net rise of 3,550.61 points or 42.65 per cent.
The market was consistently supported by strong global cues and continued capital inflows as well as encouraging built-up of derivatives positions in the opening week of May series amid concerns about fluid political situation in the country.
Brokers said the market also drew support from hopes of early recovery in domestic as also global economy.
The 50-issue Nifty of the National Stock Exchange flared up by 146.75 points or 4.22 per cent to finish the week at 3,620.70 from its last weekend's close.
Sustained frenzied buying by Foreign Institutional Investors (FIIs), the main market movers, on the back of signs of early revival in the global economy boosted the market sentiment. They pumped in Rs 3,168.71 crore in the current week, including provisional figure of May 8.
Better-than-expected US home sales data and rise in Japan's industrial production in March 2009 for the first time in six months showed that the global recession might be easing.
Taking the lead, metal, consumer durable and metal shares attracted heavy buying interest and notched handsome gains.
As a result, the sectorial BSE-Metal index zoomed by 1,064.06 points or 15.45 per cent on the back of expectations of good demand from China after increase in the CLSA China's Purchasing Managers's index in April 2009 and also firm trend on London Metal Exchange (LME).
The BSE-CD index soared by 190.91 points or 10.86 per cent and the BSE-Realty by 225.20 points or 10.57 per cent.
The rally was so strong that besides BSE-FMCG, all other sectorial indices ended in the green with a gain between 15.45 per cent and 1.78 per cent. 24 out of 30 index based counters also ended with sharp to moderate gains.
According to other analysts, the volatility might remain for a few more days because of fears of political uncertainty after the general election results due on May 16.
SMC Global Vice-President Rajesh Jain said: "With election results round the corner, investors are shying from taking fresh positions. The rally has stretched for more than two months a reaction is expected now. Smart investors are resorting to profit taking to stay away from uncertainty."
Meanwhile, the inflation rose to 0.70 per cent for the week ending April 25 from 0.57 per cent in the preceding weekend.
From the sensex family, Hindalco jumped by 26.83 per cent, Sterlite Ind by 20.27 per
cent, Tata Steel by 18.67 per cent, L&T by 12.65 per cent, Tata Motors by 10.75 per cent, REL Infra by 10.64 per cent, ICICI Bank by 8.97 per cent, Wipro by 7.41 per cent, Ranbaxy by 7.35 per cent, REL COM by 6.82 per cent and RIL by 5.23 per cent.
The BSE Small-cap and Mid-cap indices outperformed the sensex in the week, indicating fresh participation of retail investors and were up by 336.36 points or 8.54 per cent and 256.56 points or 7.30 per cent respectively.
The S&P CNX Defty firmed up by 137.05 points or 5.71 per cent to 2,538.90 from 2,401.85 and the CNX Nifty Junior also rose by 244.95 points or 4.64 per cent to 5,526.75 from 5,281.80 last weekend.