For the week, both indices - the Sensex and the Nifty - ended 1.25 percent and 1.30 percent higher, their third straight weekly gains.

The 30-share barometer started on a weaker note, but ended higher by 43.36 points, or 0.17 per cent, at 26,160.90 – its highest closing since December 1. The 50-share Nifty was up 16.85 points, or 0.21 per cent, to close at 7,963.20 -- a level last seen on November 4 last year. It shuttled between 7,909.80 and 7,972.55 intra-day.

The gauge had gained 157.51 points mainly on the back of covering-up of short positions by speculators. Most international markets were closed for the New year. The near-absence of  overseas cues meant investors remained directionless despite the start of the January derivatives contracts.

"With major Asian markets shut for New Year celebrations, Indian markets started the day without any opening bias, and the push above recent ranges prompted short covering," said Anand James, Co Head Technical Research Desk, Geojit BNP Paribas.

Tata Motors was on the top of the heap, up 2.66 per cent, followed by Adani Ports (2.65 percent). Investors also lapped up second-line stocks, with mid-cap and small-cap indices outperforming the Sensex with gains of 0.92 percent and 0.88 percent, respectively.

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