Mumbai: The BSE benchmark index Sensex on Tuesday closed higher by 76 points on funds buying in bluechips as eased inflation bolstered hopes of policy rate cuts by RBI.

The barometer, which had gained 24 points in the previous session, added another 75.73 points, or 0.43 percent to 17,848.57 points.

The investor confidence bolstered on easing inflation despite a weakening global trend, brokers said. European and Asian stocks declined after Moody’s Investors Service downgraded six euro-area countries.

In intra-day trading, the 30-share Sensex climbed to 17,890.33 on better than expected quarter results by Tata Motors and short-covering in some frontline stocks.

Tata Motors posted 40.51 percent jump in consolidated net profit to Rs 3,406 crore for the quarter ended December 31, 2011.

The broad-based Nifty of the National Stock Exchange rose by 25.85 points, or 0.48 percent, to 5,416.05. It touched the day's high of 5,428.05.
The upsurge was led by capital goods, realty, auto and banking stocks on hopes a further cut in interest rates would add to their business.
The capital goods sector gained the most by 2.30 percent to 10,452.15 as Larsen and Toubro spurted by 3.87 percent to Rs 1,379.35 and BHEL by 1.67 percent to Rs 264.95. Alstom Project rose by 8.95 percent to Rs 417.35.

The realty sector was the second best performer by rising 2.29 percent to 1,933.77 followed by auto sector index by 2.14 percent to 10,005.14 and banking index by 0.81 percent to 12,127.07.

Prominent gainers were State Bank of India, ICICI Bank, Tata Motors, Hero MotoCorp, Mahindra and Mahindra, Infosys, Hindalco, Sun Pharma and Tata Steel on investment buying.