Sensex back above 8000 as markets open New Year with strong rally

The markets opened the day marginally in the positive but slipped into the red soon after. After drifting lower in mid-morning trades, the indices clawed back later in the day helped by good institutional buying.

News that FII's were net buyers in the derivatives segment in yesterday's muhurat trading helped the sentiment. Continuing firmness in Asian markets and a strong closing by US indices yesterday further added to the sentiment. If crude oil prices stay below $60 to a barrel, global growth is expected to be stable with inflation under control.

The Sensex crossed the 8000 mark decisively and the Nifty was trading above the 2400 mark by early afternoon trades. The last one hour saw the indices surge ahead as the technology stocks came back strongly. Both frontline indices closed the day with gains of one-and-a-half per cent each.

Cement stocks were the stars of the day, led by Gujarat Ambuja Cement. The stock made a smart bounce back on reports of firm cement prices and closed with gains of over 4 per cent. Grasim closed almost 5 per cent higher while ACC added over 3 per cent.

Metal stocks staged a smart comeback and the metal index was the biggest gainer among sectoral indices. SAIL was the biggest gainer, closing almost 4 per cent higher. Tata Steel closed with gains of over 2 per cent.