Indian markets closed higher for second consecutive day, tracking positive global cues. Fading concerns about coronavirus and expectations of an economic recovery pushed Nifty 0.8% higher to 12,201. The Sensex also surged 350 points, driven by gains in select banking stocks and heavyweights such as HUL and RIL. From its Budget day lows of 11,633, the Nifty is up around 600 points.

Many analysts say that this leg of rally has more steam left and the index could test its previous highs of 12,430, hit last month.

"Nifty tested 11600-11650 levels recently and and now is an uptrend for the short term. We expect 12450-12500 to be conquered in the near term. Buying on dips is advisable with immediate support seen at 12,000-12,050 levels," said Sahaj Agrawal, Head of Research- Derivatives at Kotak Securities.

FCMG heavweight HUL today surged about 5%. “Nifty and Sensex closed higher today mainly due substantial gains from Hind Unilever. Consistent fall in crude and palm oil prices would help the company to improve on the top line and bottom line of the company. It’s an index giant stock and such type of fundamental developments helps mainline indices like Sensex and Nifty. Technically, Nifty closed above the level of 12200, which is positive," said Shrikant Chouhan, senior vice-president at Kotak Securities.

Market observers will keep an eye on inflation and industrial output data due next week. "Indications are in the favour of the current upmove to continue but participation could remain restricted. So traders should plan their positions," said Ajit Mishra, VP - Research, Religare Broking Ltd.

"According to latest reports, the risk of coronavirus spreading further is fading. Besides, the statement by the Finance Minister that green shoots of growth are already visible further added to positivity."

However, broader markets remained subdued today, with BSE midcap and smallcap indices ending mildly lower today.

"Technically, the overall texture of the market has turned bullish which may lead a move towards 12,500 level in the coming days where 12,300 will be intermediate resistance level while 50-DMA of 12123 will act as immediate support in the downside," said Santosh Meena, senior analyst at TradingBells.

"Indian equity markets are continuing their bullish momentum on the back of buying in heavyweights and short-covering by FIIs in index future. Large caps are doing well but the broader market is underperforming for the last two days where the advance-decline ratio is in favor of decline. FIIs are covering their short positions in the index future but they are reluctant to buy in the cash market. The market may again head towards an all-time high once FIIs will start buying in the cash market."

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