Markets trimmed their early morning gains by close with the benchmark index settling at 16,415 levels, up 99 points.
The Sensex touched a high of 16,540 levels in intra-day deals. In broader markets, the Nifty gained 34 points to 4,870 levels.
“During the last three days, the markets have exhibited a rangebound movement. The Sensex needs to trade above 16,666 to restrict the downward trend. It has support at 16,192 levels,” said a technical analyst with Religare Securities.
In other Asian markets, Nikkei surged 115 points to end the morning session at 14,240 after hitting its highest since 19 May.
Back home, inflation for the week ended 17 May touched 8.1%. Finance Minister P Chidambaram has yet again assured that the government will take all necessary steps to stem this rise.
The government also reported better-than-expected GDP figures for FY08 on 30 May. Buoyancy in agriculture pushed the economic growth to 9% in the last fiscal, up from 8.7% estimated earlier.
At the bourses, leading the pack of gainers among the BSE-30 scrips was Ranbaxy Laboratories. The counter surged 4.8% or Rs24. Bharti Airtel, BHEL, Infosys Technologies, TCS Limited, Hindalco and HDFC Bank were some of the other notable gainers.
Larsen & Toubro continued to rise for the second consecutive session on the back of the company reporting a strong performance for quarter ended March 2008 and a 1:1 bonus announcement. The stock at Rs2,981 moved up 3.2% by close.
Among sectoral indices, the BSE capital goods index was the top gainer that surged 2.5%. Key gainers in this space included AIA Engineering, Alstom Projects, Punj Lloyd, Suzlon Energy, BEML Limited, Kirloskar Oil Engineering, Crompton Greaves, BHEL and Larsen & Toubro.