Markets post best gain in 2 weeks

Indian shares posted their biggest gain in two-week this Friday on back of buying in rate-sensitive sectors such as banks, real-estate, auto ahead of key central bank policy review next week.

The Bombay Stock Exchange's 30-share index Sensex rose 179.75 points or 0.9% and ended at 20,103.53 while the National Stock Exchange's 50-share Nifty gained 55.30 points or 0.92% to close at 6,074.65. Sensex posted its biggest percentage gain since January 14.

The Reserve Bank of India will unveil its mid-quarter policy review on January 29 amid expectations the central bank will cut interest rates to boost growth into the Asia's third-biggest economy.

Most economists expect the RBI to cut its policy repo rate by 25 basis points on Tuesday to 7.75 per cent.

The RBI last cut rates in April 2012 by 50 basis points but warned at the time there would be limited scope for further cuts on back of inflationary concerns.

In the results calendar, Tata Coffee will declare its third quarter performances later today while Adani Ports, Adani Power, JSW Steel and Reliance Infrastructure are scheduled on Monday.

Globally, Asian shares ended down on concern over corporate profitability while Japanese shares rose on optimism about the earnings prospects for Japanese exporters with the yen weakening.

Hong Kong's Hang Seng fell 0.08% to 23,580, Taiwan's Weighted index declined 0.3% to 7,672, Singapore's Straits Times inched up 0.44% to 3,262 while China's Shanghai Composite dropped 0.5% to 2,291 and Japan's Nikkei rose 2.88% to 10,926.

European markets traded mixed, France's CAC rose 0.08% to 3,755, Germany's DAX gained 0.06% to 7,753 while UK's FTSE was down 0.18% to 6,253.

Back home, all sectoral indices gained with metals, capital goods, autos, banks, real-estate,

health care indexes topping on BSE.

Among key Sensex stocks, Maruti Suzuki surged 4% while Tata Motors and Mahindra & Mahindra gained over 2.5%, Sun Pharma and Dr Reddy's rose 2.6% and 1% respectively while Cipla rose 2%, SBI, HDFC Bank and ICICI Bank rose 1-2%, Larsen & Toubro gained 1% on BSE.

Among losers, Tata Power fell 1%, Bharti Airtel dropped 0.6%, and Hero MotoCorp dropped 0.5%, Reliance Industries ended down 0.4% on BSE.

The other notable movers included Maruti Suzuki, country's biggest car-maker, gaining 4% at Rs 1,596 after the company reported a better-than-expected 144% year-on-year (yoy) growth in net profit of Rs 501 crore for the third quarter ended December 31, 2012 (Q3) due to higher sales and good response to new models like Ertiga and Swift Dzire.

Housing Development and Infrastructure (HDIL) surged 11% to Rs 82.50, bouncing back almost 25% from intra-day low on back of heavy volumes.

Larsen & Toubro rose over 1% today. CLSA has upgraded the stock to "outperform" from "underperform", citing favourable policies from the government and expected interest cuts would be reflected in the company's earnings by the second half of fiscal 2013/14.

Suzlon Energy surged almost 16% after country's biggest wind energy major said that the empowered group of corporate debt restructuring (CDR) cell have approved its proposal for the restructuring of its domestic debt.

The broader markets rose with mid-caps and small-caps notching up by 1-2% on BSE.

The market breadth was firm.

Out of 2,990 stocks traded, 1,656 stocks advanced compared to 1,219 declines on BSE.