Sensex up 217 pts ahead of Fed meet outcome

The BSE Sensex and Nifty rose for a second consecutive session on Wednesday to hit their highest close in five weeks, tracking a rally in global markets on expectations the US Federal Reserve would reaffirm its willingness to wait before raising US interest rates.

Blue-chips such as Tata Motors and Tata Steel led the gainers ahead of the outcome of the Fed's two-day meeting later in the day.

But some of the broader gains were capped ahead of the monthly derivatives contract expiry due on Thursday, while companies posting disappointing earnings such as Dr Reddy's Laboratories fell.

The benchmark BSE Sensex closed 0.81 per cent higher at 27,098.17 points while the broader Nifty gained 0.78 per cent to 8,090.45 points.

Auto stocks led the gains with Mahindra and Mahindra up 1.65 per cent while Tata Motors added 3.5 per cent. The sector was also aided by expectations of higher sales during the ongoing festive season.

Metal stocks rose sharply on the back of firmer prices in international markets. Hindalco gained 6.23 per cent while Tata Steel added 4.54 per cent and Jindal Steel and Power closed up 4.2 per cent. Technology and consumer stocks also gained. Infosys ended 2.5 per cent higher after having falling 3.9 per cent since October 13. ITC ended 1.23 per cent higher, but is still down 4.2 per cent so far this month.

However, Dr Reddy's closed down 0.81 per cent after its earnings missed some analysts' expectations.

Shares in Jubilant Life Sciences plunged 11.34 per cent to a two-week low after it net loss widened in the September quarter.

Shares in Oriental Bank of Commerce slumped 4.1 per cent on rising bad loans.