Indices bounce back and close at new all time highs

With the political environment showing signs of cooling down after yesterday's unsuccessful terrorist attack in Ayodhya, the markets turned their attention back to the economic environment. Traders were greeted in the morning by reports of good rains across the country, though flooding has caused some damage in Gujarat.

The Met department expects rains during the current month to be very close to normal and the deficiency reported in June will be wiped out by the end of the season. A strong showing by the US markets yesterday added to the positive sentiment and helped the markets to bounce back after yesterday's correction.

After remaining indecisive for the first hour, the indices started an up trend which took them above the all time closing highs posted on Monday. Early afternoon saw some decline on profit booking.

The last one hour saw the indices surging again which took the Sensex very close to the 7300-mark.

Both the Sensex and Nifty closed at a new all time closing highs of 7287 and 2228 respectively. Gains on both indices were more than three fourths of a per cent each. Nifty July futures discount to the spot index narrowed considerably to just 1 point.

Among Nifty stocks, ABB, MTNL and HDFC were the major percentage gainers while Bajaj Auto, Maruti and ONGC were the major losers.