India's stock market came very close to conquering the 18,000-point milestone but receded on profit booking, only to close the day with a gain of 518 points - its third biggest point-wise rise.
Although the market breadth was weak, buying in select heavyweight counters helped the 30-share Bombay Stock Exchange benchmark Sensex to complete one of the best 11-session gaining streaks of the year.
The surge prompted Finance Minister P Chidambaram to advise caution to retail investors, although he welcomed the interest shown by FIIs.
Foreign institutional investors (FIIs) remained at the centre stage of the current rally and pumped in nearly USD 4 billion since September 19 and over USD 12 billion in the current year so far.
The BSE barometer opened firm at 17,467.41 as against Monday's close of 17,328.62. But it later gyrated in a wide range of 17,953.07, an all-time intra-day peak and 17,288.41 before ending at a new high of 17,847.04, a steep rise of 518.42 points or 2.99 per cent.
Similarly, the broader S&P CNX Nifty of the National Stock Exchange (NSE) also logged a new intra-trade peak of 5,261.35 before concluding at 5,210.80, a net gain of 141.85 points over the previous close of 5,068.95.
The gain of about 200-300 points each day in just four sessions and the sudden surge to the new peak indicates a bubble formation in the market, Mutual Fund Tracking firm Value Research Online CEO Dhirendra Kumar cautioned.
"The sudden dips and scaling of new peaks scares the investors and the nervousness is bound to affect the market sentiments any day," he added.
Today's rally was led by realty counters while IT shares also attracted good buying support.