Markets extend gains; Nifty tops 7,900

ONGC, L&T, HDFC and Tata Motors among the top gainers of the hour

Markets extended gains after the first hour of trade as the fuel reforms led to a rally in state-owned oil and gas shares while financials gained on expectations of more reforms by Narendra Modi-led BJP to push economic growth post its stellar performance in Maharashtra and Haryana assembly polls.

At 1050 hrs, the Sensex was up 397 points at 26,506 and the Nifty was up 122 points to trade at 7,902.

Broader markets gained 1.5% each, outperforming the BSE benchmark index.

Barring IT and Teck, all the other sectoral indices were in green with gains of atleast 0.7%.

Profit taking in IT frontliners dragged the IT index into the red down 0.4%. Infosys, TCS and Wipro down 0.2-1% were the draggers in this pocket.

Reliance Industries, BHEL and Hero Moto Corp were the only losers among Sensex-30.

Reliance Industries dipped nearly 3% at Rs 913, its lowest level since March 31 this year on BSE as the company will not get the new gas price for its currently producing Dhirubhai-1 and 3 gas fields in eastern offshore KG-D6 till it makes up for the shortfall in production in the past four years.

Gains in bank shares have lifted the Bank Nifty near its 52-week high on expectations of more reforms to push the economy on the growth track after Narendra Modi-led BJP emerged as the largest party in Maharashtra, the country's largest industrial State and is poised to form a government in Haryana after acquiring a majority.

State-owned banks which led the Bank Nifty include PNB, SBI, Bank of India, Bank of Baroda and Canara Bank up 1.8-3.5% each.

Among the private sector banks, Kotak Mahindra Bank, Yes Bank, HDFC Bank and IndusInd Bank were up 1.2-3% each. HDFC Bank touched a record high of 909.60 and IndusInd Bank touched a record high of 674.90 on the NSE.

Among other shares, Panasonic Appliances India was locked in upper circuit of 5% at Rs 194, also its 52-week high on BSE, after the company said its board have approved the delisting proposal received from the promoters, , Panasonic Corporation.

UltraTech Cement was up over 3% at Rs 2,402 after the cement major reported better-than-expected earnings during the second quarter ended September 30, 2014 because of robust sales growth.

Repco Home finance gained around 4% in early trading on the BSE on the back of Reserve Bank of India permission to the housing finance company to raise its foreign shareholding to 49%.

Jindal Steel and Power was down over 6% at Rs 139 after the Central Bureau of Investigation (CBI) has registered a case for alleged cheating and criminal conspiracy related to one of its largest functional coal mines in Chhattisgarh.

Unichem Laboratories dipped 8% to Rs 204 after reporting a 38% year on year (yoy) declined in net profit at Rs 22.30 crore for the quarter ended September 2014, due lower growth in operational income and higher raw material cost.