Sensex surges as funds turn net buyers

The BSE benchmark Sens*x saw a second spectacular rise of 400 points in two consecutive days as foreign and domestic funds turned net buyers with the govt indicating early signs of economic recovery amid a higher beginning at European stock markets.

The Sens*x, which had gained 453 points in the previous session, spurted by 399.54 points at 14,253.24 points, after touching the day's high of 14,299.54.

The broad-based 50-share National Stock Exchange index Nifty shot up by 122.10 points at 4,233.50.

The upsurge started soon after Finance Minister Pranab Mukherjee on Tuesday said the economy is showing early signs of recovery and the government had to increase borrowing to invest more in the absence of private investments.

The rally was also supported by reports of European markets starting higher on strong results from US firms Goldman Sachs and Intel, boosting confidence across Asia.

A similar trend of encouraging quarterly results by domestic blue-chip companies led by HDFC Bank also remained a driving force behind the gains.

Government-run and Sens*x member Bharat Heavy Electricals Ltd gained 6.4 percent after the finance minister said the government would announce plans to sell small stakes in state-run firms in three to four weeks.