Market update: Sensex rises 217 pts to five-week high ahead of Fed meet outcome

The benchmark Sensex on Wednesday surged 217 points to end at five-week high of 27,098.17 powered by gains in interest rate sensitive stocks, tracking rally in global markets ahead of the outcome of US Federal Reserve's policy meeting .

Besides, hopes of further economic reforms by Modi government, rising rate cut expectations and fall in international oil price too buoyed sentiments, said brokers.

Rising for the straight second straight day, the BSE Sensex reclaimed the key 27,000-mark for the first time since September 22.

It touched the day's high of 27,107.93 before settling the day with a gain of 217.35 points, or 0.81 per cent, at 27,098.17 points. The gauge had gained 127.92 points in the previous session.

The 50-share NSE Nifty ended 62.85 points, or 0.78 per cent, higher at 8,090.45 after moving between 8,097.95 and 8,052.25 intra-day.

"Expectations from the FOMC meet, resultant nervousness and profit booking kept the market range-bound today. We expect US Fed to wrap up its bond buying program but it would continue to maintain low interest rates for long term," said Rakesh Goyal, Senior Vice President, Bonanza Portfolio.

In addition, covering-up of short positions by speculators ahead of Thursday's monthly expiry in the Indian derivatives segment played a part in trading.

Stocks of commercial vehicle makers were in good demand.

Tata Motors shares climbed 3.41 per cent and M&M gained 1.77 per cent among others. Other Sensex components which supported the key indices included Hindalco, Tata Steel, Sesa Sterlite, RIL and Infosys.

Dr Reddy's Laboratories reported 16.82 per cent decline in consolidated net profit at Rs 574.1 crore for the second quarter. It shares fell over one per cent. Dr Reddy's peer, Sun Pharma also saw its counter slip over 1 per cent.

The breadth of the market was positive with BSE Midcap and Smallcap indices inching higher.

Sectorwise, BSE Realty index gained the most by rising 2.97 per cent, followed by Metal index (2.63 pc), Auto index (1.79 pc), IT index (1.47 pc), FMCG index (1.23 pc) and Oil & gas index (1.19 pc).