Mumbai: Sensex and Nifty hit their highest level in nearly three weeks on Wednesday in the absence of foreign selling pressure ahead of year-end holidays, and following overnight gains on Wall Street after data showed the US economy grew at a healthy clip in the third quarter.
Foreign investors, who have been net buyers so far this year, have sold about $689 million worth of equities this month.
With little less than 24 per cent of ownership of Indian shares, their absence has reduced selling pressure on domestic markets, according to analysts.
"Generally FIIs have been sellers, their absence has given the market reason to be steady to high," said Deven Choksey, managing director at KR Choksey Securities.
"Only few stocks are giving the market some kind of rally or thrust, but fundamentals have not changed".
Wall Street rallied across the board on Tuesday after the US Commerce Department said gross domestic product grew at a 2.0 per cent annual pace, instead of the 2.1 per cent rate reported last month.
The broader Nifty was 1 per cent higher at 1.56 p.m. on Wednesday and the benchmark BSE Sensex was up 1.1 per cent.
Earlier in the session, both indexes hit their highest level since December 3.
All sectors were trading in the green, led by NSE heavyweight Reliance Industries with a gain of 1.85 per cent.
Sun Pharmaceutical Industries rose 3.2 per cent after brokerage Kotak said the US FDA warning letter over its Halol plant did not highlight major data integrity issues.
Meanwhile, market debutants Alkem Laboratories and Dr Lal PathLabs opened 31 per cent higher each.
Indian markets will be closed on Friday for Christmas.
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