The markets ended higher for the second straight session on the back of buying seen in scrips across sectors. The rally was inline with Asian markets. Capital goods, power, pharma and metal stocks were among the major gainers. Select auto stocks were under pressure. The volumes were very low and the midcap index underperformed the broader markets. BHEL and NTPC continued the uptrend and were the top gainers and the other gainers were HDFC and Zee Entertainment.

The Sensex gained 162.19 points or 1.28% to end at 12786.77, while the Nifty was up 42.60 points or 1.15% to end the day at 3733.25. About 1535 shares have advanced, 893 shares declined, and 79 shares remained unchanged. The BSE Midcap Index ended at 5,280.07 up 43.7 points or 0.83%. The BSE Smallcap Index ended at 6,386.48 up 73 points or 1.2%.

Vibhav Kapoor of IL&FS feels that this rally might turn out to be the beginning of a bear market. He says lately things havent been that great, citing bad news in the past few weeks, such as an unexciting Budget, interest rate rise, and lately a slow down in some sectors - particularly the auto numbers, topped up with the whole cement controversy.

"We have been pretty bearish on the market ever since 14,000-14,500. Our first target of 12,000-12,400 has been met but since we have had further bad news on interest rates, etc, we believe that there is more downside into this market," he predicts.

He further pegs 12,913 as a very big resistance and does not anticipate a big bounce back into the market with the rationale, "There are quite a few sectors where you do not see really any upside now," but says that cement could give a small bounce back in the bear market. Suddenly, the auto sector as a whole doesn't look that good. Banking too does not seem to have any upside due to the higher interest rates and bond yields and so on so forth according to Kapoor.

Mudar Patherya, Investment Analyst points out that market-focused people miss the big moves, because, "inevitably when the markets are down, you lose nerve and when the markets are up, you have nerve and then you overly commit on the higher prices and sell out on the lower prices." According to him, right now it is a good time to stop worrying about the market and start worrying about value. He feels that that he would rather invest in the small caps after the current correction.