Sensex rises 161 points on jump in factory output

The benchmark BSE Sensex on Monday rose 161 points to 26,586.55 on account of better-than-expected factory output data and steady inflation, while value-buying in beaten-down stocks also added to the upside.

Besides, sentiment also turned positive on reports of steady progress in monsoon, traders said.

Industrial production grew at a two-month high of 4.1% in April, primarily driven by manufacturing sector, while retail inflation edged up to 5.01% in May.

Meanwhile, a data showed wholesale inflation remained in the negative zone for the seventh consecutive month in May following easing prices of fuel and food items.

In volatile movements, the 30-share Sensex after falling to the day's low of 26,307.84, staged a strong comeback at a rapid pace to hit high of 26,728.60. On profit-booking towards the close at improved levels, it trimmed gains and settled 161.25 points or 0.61% higher at 26,586.55.

The gauge had gained 54.32 points in the previous session.

The 50-share NSE Nifty managed to end above 8,000-level by rising 31 points or 0.39% to 8,013.90 after shuttling between 8,057.70 and 7,944.85 intra-day.

The rise in Sensex was supported by gains in Sun Pharma with gain of 2.95%. Bajaj Auto surged 2.13%, HDFC Ltd 2.07% and RIL 1.33% were among other gainers.

Among 30-Sensex constituents, 17 ended higher.

Shares of Cairn India rose by 3.79% to Rs 187.60 as private miner Vedanta moves to absorb the oil firm in a US $2.3-billion deal to create India's largest diversified natural resources company. Vedanta ended 1.49% down.

The broader markets, however, saw a mixed trend with the BSE small-cap index rising 0.42%, while mid-cap shedding 0.01%.

Meanwhile, foreign investors sold shares worth Rs 670.96 crore last Friday, as per provisional data.

Globally, other Asian markets ended lower and European stocks were down in their early trade.