Sensex ends 154 points up on Dhanteras day

Mumbai: It was a good start to the week as Dhanteras and strong Asian cues allowed investors/traders to pick stock across sectors. But the market shaved off more than half of those gains in the last couple of hours of trade due to fall in banking and capital goods stocks. The 30-share BSE Sensex closed up a mere 153.64 points at 16,939.28 and the 50-share NSE Nifty ended up 48.40 points at 5,098.35.

Market across globe rallied in anticipation that the European Union Summit, scheduled on Wednesday, will figure out a solution to the debt crisis. Talks of a G-20 meet on November 3-4 also nursed sentiments worldwide. Euro zone finance ministers approved the next round of aid for Greece during last weekend.

Euro leaders say they are making progress towards a wide ranging plan and aim to reach a final agreement on Wednesday, before the G20 summit in France.

Richard Harris, chief executive at Quam Asset Management expects Europe to improve at a steady pace. Moreover, he indicated that the result expected on Wednesday is a temporary solution.

European markets like France's CAC, Germany's DAX and Britain's FTSE were up between 0.3 per cent and 0.8 per cent, at the time of closing of Indian equities. Asian markets closed on strong note, rising 2-4 per cent.

Back home, the BSE IT, Auto, Oil & Gas, FMCG and Realty indices moved up 1-2 per cent while the Capital Goods Index fell 1.8 per cent and Bankex lost 0.4 per cent.

The RBI policy event, which is set to announce on Tuesday, could be the cause of concern behind Monday's fall in major banks. SBI tumbled 2 per cent and PNB lost over 1 per cent. ICICI Bank and HDFC Bank were down 0.2-0.5 per cent.

Majority of experts believe RBI may hike key rates by 25 basis points. K Ramanathan of ING Investment Management says that a 25 basis point hike is well in the price and a rate hike seems on the cards though any indication might not come in the speech tomorrow.

L&T crashed another 3 per cent after its weak guidance for FY12. BHEL too followed the same trend, losing 0.5 per cent.