Stocks rally, Sensex surges 567 pts

Positive global cues and value-buying at lower levels helped the Sensex stage a big rebound on Monday after losing nearly 650 points in the previous three sessions.

Tracking firmingglobal trend, the Bombay Stock Exchange benchmark Sensex on Monday rose themost in two months by 567 points on buying by funds in IT, bank and metalstocks.The Sensex ended up 567.56 points, or 3.6 per cent, at 16,416.33. The gauge had jumpedby 513 points on June 24.

The wide-based National Stock Exchange Nifty index gained 171 points to rise to 4,919.60.

Reliance Industriesrose by 4.80 per cent to Rs 754.05, while Infosys by 4.23 per cent to Rs2,297.85. The two scrips carry nearly 21 per cent weightage on the benchmarkSensex.

The upsurge was ledby software technology exporting companies on expectations of better earningsafter the Federal Reserve said the US economy is poised to grow in thesecond half of 2011.

The IT companies getmore than 50 per cent revenue from the US and European markets.

The IT sector indexrose by 5.06 per cent to 4,958.90 as Tata Consultancy Services rallied 7.32 percent to Rs 1,018.60 and Wipro, the third-biggest software maker rose 3.12 percent to 329.20.

Barring Maruti Suzukiand ONGC, all other 28 index-linked stocks closed with gains. All sectoralindices ended in the positive zone.

Brokers attributed the widespread recovery in stock prices to a firming trend in other Asian markets on the back of gains recorded in the US market on Friday after Federal Reserve chief Ben Bernanke's prediction of long-term economic growth for the US. Most of the European markets were also higher on Monday.

Asian stock markets rose on Monday, after Federal Reserve chief Ben Bernanke's prediction of long-term U.S. economic growth fueled a Wall Street rebound. Japan's Nikkei 225 index rose 0.5 percent to 8,845.19. Australia's S&P ASX 200 gained 1.5 percent to 4,264.20 and New Zealand's NZX 50 rose 0.6 percent to 3,313.85.

South Korea's Kopsi index jumped 2.7 percent to 1,826.35.

On Friday, the Dow Jones industrial average rose 1.2 percent to close at 11,284.54. The Standard & Poor's 500 index rose 1.5 percent to 1,176.80. The technology-heavy Nasdaq composite index rose 2.5 percent to 2,479.85.

The Fed has said it plans to keep short-term interest rates low until mid-2013. Low rates on investments like bonds make higher-risk bets such as stocks more attractive.

-With agency inputs