Oil stocks and Reliance take Sensex past 8600 and Nifty above 2600

If somebody had predicted last Thursday that the markets would recover and the Sensex would cross 8600 and the Nifty would be above 2600 within a week, it would have invited derisive laughs. All market analysts and observers were predicting a further decline before the markets stabilise and recover.

However, markets have a way to make most analysts and other wise men look almost stupid. Helped in part by the over enthusiasm of the bears, who went heavily short last week and were forced to cover their positions this week, the indices have recovered in no time and gone on to post new lifetime highs.

Oil stocks, which have grossly underperformed the indices in the bull run, perked up today and rallied smartly. The pack was led by ONGC, which was trading at a new lifetime high by late afternoon with gains of more than 3 per cent. The stock closed with gains of close to 3 per cent. ONGC was ably supported by BPCL and HPCL, the former closing almost 4 per cent higher.

Reliance Industries also saw good buying interest in afternoon trades after remaining indecisive in early trades. The stock firmed up almost 2 per cent and crossed the Rs800 mark for the first time ever.

Good buying was seen in the capital goods sector. BHEL and L&T were the big winners in this space, gaining more than 2 per cent. Among the other gainers in frontline stocks were HLL and Tata Power, both adding more than 2 per cent each.

ICICI Bank continued its rally and crossed the Rs600 mark today, before closing with gains of more than a per cent. HDFC added close to 4 per cent while HDFC Bank gained 2 per cent.