Sensex rises on RBI's bullish outlook

The RBI's positive outlook on the Indian economy did much to contain the markets' uneasiness seen during the past two days over government formation as the BSE Sensex went up 301 points on Friday, with Ranbaxy and ICICI Bank being the chief gainers.

The Sensex, however, came off its intra-day high of 12,219.54 due to selling pressure from foreign funds.

The BSE bellwether settled the day at 12,173.42, a net rise of 300.51 points or 2.53 per cent over its last close.

RBI governor D Subbarao said on Thursday India's recovery will be more swift than others.

The National Stock Exchange's 50-share Nifty also spurted by 78.20 points or 2.18 per cent to close at 3,671.65 from its last close.

India's largest drugmaker Ranbaxy Laboratories logged the day's biggest gains of 8.59 per cent on expectations that the company may trim its Q2 losses with the rupee's appreciation against the dollar.

Among others, India's largest private lender ICICI Bank gained 7.03 per cent, Grasim 4.96 per cent, Bharti Airtel 4.68 per cent, and L&T 4.32 per cent.

ONGC, however, dropped by 2.27 per cent.

"The results of the exit polls are vague but one thing is clear -- either the UPA or the NDA will come to power. Markets are hoping that they do well," SMC Global vice-president Rajesh Jain said. 

Asian indices ended remarkably higher with the Hong Kong, Japan and Taiwan indices rising by about 2.0 per cent.

Analysts said trading volatility may remain high until the next government takes office at the Centre.

The banking index gained the most, 3.86 per cent, reaching 6,375.65, followed by capital goods, which rose 3.57 per cent to 8,676.35.

The consumer durables index rose 3.18 per cent to 2,007.22, teck 3.05 per cent to 2,316.65, IT 2.47 per cent to 2,850.73, power 1.88 per cent to 2,216.53, and realty 2.14 per cent to 2,404.87.

The metal index rose 1.76 per cent to 7,872.70, healthcare 1.49 per cent to 3,161.14, oil and gas 1.21 per cent to 8,509.62, auto 1.11 per cent to 3,742.86 and PSU 0.13 per cent to 6,038.18.

However, the FMCG index fell by 0.24 per cent to 2,054.98.

With the market experiencing brisk buying, the midcap index rose 1.33 per cent to 3,807.07 and the smallcap index by 0.84 per cent to 4,279.60.