The BSE benchmark Sensex advanced by 34 points on Monday amid firm global cues and hopes of strong June quarter GDP data, though profit-booking in IT and FMCG stocks shaved off most of the early gains.
     
Markets opened on a cheerful note in view of the strong performance of the US market and good gains recorded by the Asian markets. However, profit-booking gradually trimmed gains and the Sensex ended at 18,032.11, up 33.7 points, or 0.19 percent.
     
The 30-share barometer of the Bombay Stock Exchange had gained 218 points to hit a high of 18,216.50 in early trade, helped by a smart rise in metal, consumer durables and auto stocks.
     
The National Stock Exchange's wide-based 50-share Nifty Index finished at 5,415.45, up 0.12 percent.
     
"Investors were concerned about the changes in taxation of capital gains in the revised DTC which was to be presented in the Parliament. However, as the details trickled in, the market heaved a sigh of relief and recovered a part of lost ground," Bonanza Portfolio Vice-President Avinash Gupta said.
     
Tata Steel zoomed 3.49 percent and was the top performer in the Sensex pack after the steel major's European arm Corus decided to sell its Teesside cast products plant to Thailand's Sahaviriya Steel Industries for USD 500 million.
     
"The deal is a positive development for Tata Steel as the operations at TCP were unviable after its four key clients walked away from a long-term contract in 2009 (about 80 percent of TCP's business)," Angel Broking said in a note.      

Other metal stocks also attracted buying, amid hopes steel prices may go up by next month. Hindalco increased by 1.96 percent, Jindal Steel 1.53 percent and Sterlite Industries 0.49 percent. The rise in metal stocks, pushed the BSE Metal Index to the top of the gainers' list.
     
State-run ONGC added 2 percent on media reports that it will get permission from the Centre to pay only a third of its total royalty obligation to the Rajasthan government on the production from oil blocks it jointly owns with Cairn India.
     
"Restricting the royalty burden to 30 percent will come as a major relief to ONGC shareholders and remove an overhang from the stock," a broker said.
     
Other major gainers during the session include Bharti Airtel, which rose 2.12 percent, while ICICI Bank 1 gained percent, R-Infra 1.64 percent and HDFC 0.91 percent.
     
However, worried over the rise in MAT, software major TCS declined 1.14 percent and Infosys by 0.92 percent. However, another software exporter, Wipro rose by 0.93 percent.

The DTC proposes to raise minimum alternate tax to 20 percent. MAT is imposed on profit-earning entities, which do not fall under the tax net because of various exemptions. Furthermore, Dividend Distribution Tax is proposed to be fixed at 15 percent and corporate tax at 30 percent.
     
Common man benefits

Welcoming the Direct Taxes Code (DTC) Bill introduced by Finance Minister Pranab Mukherjee in the Lok Sabha on Monday, analysts said overall it is good for the common man. The DTC proposes to raise the exemption limit on income tax from Rs 1.6 lakh at present to Rs 2 lakh.
     
"Overall the DTC Bill is good for the market, though rise in MAT had some negative impact on some specific sectors," Networth Stock Broking Head of Institutional Business Prakash Diwan said.
     
Hopes of a strong growth in India's gross domestic product, data which is due to be announced on Tuesday, also helped the market record gains.
     
"The expansion in the economy is expected to match up the growth of 8.6 percent seen in the last quarter of the fiscal 2009-2010," said an analyst.
     
The investor sentiment turned bullish across the world after US Federal Reserve Chief Ben Bernanke said it "will do all that it can" to safeguard growth. In addition, stronger- than-forecast US economic growth eased concerns that the world's biggest economy will fall back into a recession.
     
In the BSE-30 pack, 17 stocks closed with gains, while 13 scrips ended in the red.
     
Index heavyweight Reliance Industries -- which was in the green during the early part of the session -- ended with a loss of 0.21 percent at Rs 947.75.
     
With a loss of 1.2 percent, ITC was the worst-hit stock, followed by BHEL, which slipped 1.14 percent. L&T dropped 0.75 percent and HDFC Bank 0.43 percent.
    
On the global front, almost all the major indices were in the green.
     
Asian stocks rose the most in five weeks on speculation that the Bank of Japan will declare measures to weaken the nation's currency. Japan's Nikkei zoomed over 3 percent during the day, but ended 1.76 percent higher. China's Shanghai index added 1.61 percent.
     
European bourses were also trading higher in the afternoon session, with Britain's FTSE 100 rising nearly 1 percent.