Sensex spurts by 222 points to 16-month high

The Bombay Stock Exchange benchmark Sensex today surged by 222 points to a 16-month high as overseas funds bought shares, especially in metal and auto sectors, bolstered by expectations of early global economic recovery.

The 30-share index gained 222.59 points to close at 16,677.04 points, a level last seen on May 23, 2008.

Brokers said fund-based buying picked up on reports that the global economic recession is almost over. The US Federal Reserve Chairman, Ben S Bernanke, said the worst US recession since the 1930s has probably ended.

The wide-based National Stock Exchange index Nifty also crossed a crucial 4,900 points level gaining 66.30 points to close at 4,958.40 points.

Among the 30 Sensex stocks, 24 scrips closed with gains and six with losses. The metal sector index gained the most by 4.20 per cent to 14,527.67 points, after Tata Steel rose by Rs 40.35 to Rs531.60, its highest in a year.

Sterlite Industries, the biggest copper producer, rose by Rs27.55 to Rs 771.05 after metal prices moved up in overseas markets as sales at US retailers jumped by the most in three years in August.

Both the heaviest on the Sensex, Infosys Technologies rose by 2.10 per cent to Rs 2,317.65 and Reliance Industries by 0.15 per cent to Rs2,183.50.

The auto sector index was the second best performer rising by 2.23 per cent to 6,373.85 points followed by the consumer durable index by 2.17 per cent to 3,459.25 points. The Bank index rose by 1.99 per cent to 9,361.27 points and the realty index by 1.80 per cent to 4,457.07 points.

Brokers said banking shares posted gains after the Reserve Bank said that it would not signal a hike in interest rates till the economic recovery is on a strong footing. State Bank of India, the leading government-run lender shot up by four per cent to Rs2,089.60, an 18-month high.

Foreign Institutional Investors (FIIs), the main market driver, pumped in a whopping Rs 4,415.70 crore in last seven sessions since September 7.