The markets clocked a new high for the second straight day on market participants mainly in the futures and options space continued to hold their long positions. The derivatives expiry is scheduled on Thursday, post which the markets may witness a fresh trend. Today, the Sensex bounced back sharply from the early morning blow which it suffered due to negative news flow at the Reliance and ONGC counter. Overnight, the Election Commissioner put a stay on gas price hike with effect from 1 April, 2014, citing general elections as the reason. Following which, ONGC and Reliance opened with a negative gap – dragging the BSE Sensex and NSE Nifty with it.

The markets, however, soon found solace in banking and capital goods shares. Today, was a prime example of index management is done by large fund houses and operators. While Reliance and select IT shares like Infosys and Wipro – which were down owing to continued strength in Rupee – lead to a 78 points fall on the Sensex, of which 53 points alone was on account of Reliance. On the other hand, HDFC, Larsen & Toubro and ITC contributed 49 points to the BSE index. BHEL, Hero MotoCorp and Hindustan Unilever were the other major gainers, which helped the BSE index weigh out the negatives. In the broader markets, the BSE Midcap index in particular out-performed with a gain of 0.6 per cent.

In an interesting perspective to the market rally – the Finance minister P Chidambaram today claimed that the markets have been rallying smartly off late owing to significant policy action taken by the UPA government, and this is not a so called hope-rally ahead of the elections – hope in a sense of stable government post elections.

In other markets news, Gold and Silver (down 0.3 per cent each) continued to trade on a soft note for yet another day. The precious metals have been on a downtrend following US Federal Reserve decision to bring down the stimulus by $ 10 billion last week. Among other commodities – Natural Gas, Zinc, Lead and Copper are the prominent gainers, while Kapas has plunged over 4 per cent followed by Cardamom, Brent Crude, Mentha Oil, Cotton and Potato. Meanwhile, the Indian Rupee ended on a positive note for the third straight session, up 30 paise at 60.48 versus the US dollar. The Indian currency is now trading at fresh eight month highs.

In corporate news, Oberoi Realty won the auction for Tata Steel land in Mumbai with a winning bid of Rs 1,155 crore. It won the bid by mere Rs 5 crore difference compared to the second highest bidder. The Competition Commission of India (CCI) has order a fresh probe against Coal India following complaint filed by GHCL – which alleged that Coal India had slapped unfair conditions in fuel supply agreements (FSAs) with the power productrs for supply of non-coking coal.

From the political battle – the Arvind Kejriwal on his trip to Varanasi has criticised Modi, and accepted the challenge of contesting the elections against Modi from Varanasi. The countdown for elections has started with just 12 days remaining for the first phase to start on 7 April, 2014 in Assam, Tirupura and Uttrankhand.

In other news – Sahara group has now offered to pay dues worth Rs 20,000 crore within five instalments, with the first instalment of Rs 2,500 crore to be paid within three days of restrictions been removed from the bank accounts. Earlier, the firm was willing to pay Rs 17,000 crore. The Supreme Court may give its verdict tomorrow after examining the plea. Decision on Subrata Roy and other two directors release may also be taken tomorrow. In another Supreme Court verdict, the SC has asked N Srinivasan to step down as the BCCI president in order for a fair probe in the IPL spot fixing scandal.

In some international news, Russian has been suspended from G8 over the Ukraine crisis. The G7 has threatened to impose further sanctions on Russia, if it continues its incursion in Ukraine.