Indian stock markets ended higher for second day but the gains were capped by profit-taking at higher levels.
The Sensex closed at 38 points higher at 20,996, with the index trading in a range of 21,049.84 and 20,922.45.
Rakesh Arora, MD & Head of Research of Macquarie Capital Securities (India), said state election results which are due on Sunday are crucial for the current rally to continue. The Sensex had gained 1.2 per cent yesterday after exit polls predicted a BJP win in four states.
The improving fundamentals of the Indian economy are helping the "re-rating of Indian markets", Mr Arora said, adding that the markets could test new highs next year.
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