Local equity markets extended their gains for the second day in a row on Tuesday on the back of strong global cues and across the board buying from investors. Markets started the day on positive note tracking good gains in the key Asian indices. After witnessing minor selling pressure in the early part of the trade, markets closed near the day's high. The Nifty reclaimed the 5100-mark in trade while the Sensex fell short of the 17,200-level by just 2 points. Market participants were busy in value picking during the entire session as the Dubai concerns eased. Realty emerged as the most favored sector by the marketmen. Auto stocks were also in demand as the November sales number from industry majors like Maruti Suzuki and Hero Honda indicated that the sector will continue its leadership in coming days. Market heavyweight, Reliance Industries rallied almost three and a half percent as it emerged as the top gas producer of the country beating state-run ONGC. Finally, the BSE Sensex gained 272.05 points or 1.61% to end at 17,198.27, while the S&P CNX Nifty surged 89.30 points or 1.77% to settle at 5122.00.

The US markets closed with good gains on Tuesday and indices once again reached to the level from were they started declining on concerns of Dubai debt crisis. All the major indices were up by more than 1%.The weakness in dollar led a rally in commodity and energy stocks. There were mixed signals from the economy front but easing worries about the fallout from debt struggles in Dubai gave investors a chance to cheer. The ISM's measure of employment grew for the second straight month after sliding for more than a year. The Dow Jones Industrial Average surged by 126.74 points, or 1.23%, to 10,471.58, its highest close since October last year. The broader Standard & Poor's 500 index gained 13.23 points, or 1.21%, to 1,108.86, while the Nasdaq composite index added 31.21 points, or 1.46%, to 2,175.81.

Crude continued its upward journey on Tuesday as the dollar weakened further against Euro after the European Union said that unemployment held steady at 9.8% in October, comparatively better to US, where the Unemployment rate is more than 10%.The crude prices also got support from the report of rise in manufacturing activity in China and US. Benchmark crude for January delivery rose $1.09 to settle at $78.37 on the New York Mercantile Exchange. In London, Brent crude for January delivery gained 88 cents to settle at $79.35 on the ICE Futures exchange.

The Indian rupee extended its gains on Tuesday, well supported by the strength in the domestic equity markets. The dollar too declined against major currencies overseas as investors took the view that Dubai debt woes will be controlled. The rupees closed at 46.32, 22 paise stronger compared to its Monday's close of 46.54. The local stock markets continued their rally for the second consecutive day and kept the hopes alive for the foreign fund inflow and underpinned the sentiments of the currency.

The FII on Tuesday were the net buyers in both equity as well as debt segments. In equity segment the gross buying was of Rs 2983.90 crore against gross sell of Rs 2276.20 crore, while in the debt segment the gross purchase was of Rs 451.70 crore with gross sales of Rs 123.10 crore.

The US markets surged again on Tuesday, though the economic indicators were mixed but the investors were cheering up after the Dubai crisis eased. The decline in dollar gave a new lift in the commodity and energy stocks taking the markets to a fresh high. The Asian markets have made a good start and all the major indices are trading up by about 1%.The domestic markets are likely to continue their upmove today, well supported by the good global cues and growth estimate increase by different agencies, in wake of better than expected GDP rise in Q2. The Auto sector was in jubilant mood yesterday as most of the companies were able to report good rise in sales for the passing month, the sector is likely to remain buzzing even today.

Support and Resistance: S&P CNX Nifty and BSE Sensex

                                                          Nifty Top volumes

• Tata Motors has revoked 4, 40,882 pledged shares, representing 0.049% stake in the group company, Tata Steel.
• DLF has informed that its joint venture project with UAE-based real estate firm Nakheel has already been shelved.
• Steel Authority of India is planning to raise the steel consumption in Himachal Pradesh.
• Maruti Suzuki has sold total 87,807 units in November 2009 compared to 52,711 units in November 2008, up by 66.6%.
• Hero Honda Motors has posted a rise of 32% in its November sales to 381,378 units.