Markets remain firm

Benchmark indices continue to maintain the positive trend led by buying demand among Capital Goods, Oil & Gas and Banking shares. Meanwhile, markets are trading higher on the back of the optimism generated by the US fiscal cliff deal.

By 1300, Sensex surged by 141 points at 19,721, and the Nifty gained 45 points at 5,996 levels.

On the global front, the US Congress approved a rare tax increase on Tuesday that will hit the nation's wealthiest households in a bipartisan budget deal that stops the world's largest economy from falling into a deep fiscal crisis and recession.

Asian markets are trading firm. Hong Kong's Hang Seng gained 2% to 23,062, Taiwan's Weighted index rose 1% to 7,784, Singapore's Straits Times was up 1% to 3,200  in morning trades. Equity markets in Japan and mainland China are closed today and tomorrow for public holidays.

Back home, manufacturing activity surged to a six-month high in December, boosted by strong factory output and a spike in new orders, both of which hit their highest levels since June, a business survey showed on Wednesday.

The HSBC Markit India Manufacturing PMI, which gauges the business activity of India's factories but not its utilities, jumped to 54.7 in December from 53.7 in November, its biggest monthly rise since January 2012.

On the sectoral front, BSE Capital Goods, Oil & Gas, Consumer Durable, Banks, PSU, Metal, Power and Auto indices have surged by 1% each. Apart from FMCG, all the major BSE sectoral indices are trading in green zone.

The main gainers on the Sensex at this hour include GAIL, BHEL, HDFC, Bajaj Auto, Sterlite, L&T, Maruti Suzuki, ONGC, Hindalco and Cipla, all spurting between 1-2%.

Among other shares, PC Jeweller has surged 7% to Rs 176, extending its previous day’s over 10% rally on the Bombay Stock Exchange.

The market breadth in BSE remains healthy with 1,724 shares advancing and 996 shares declining.