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The Bombay Stock Exchange benchmark index Sensex on Tuesday regained the 16,000-mark by gaining 107 points on funds buying heavily in IT and PSUs stocks, coupled with firming global cues after worries about the sovereign debt crisis in Europe eased.

The Sensex, which gained 20 points in the previous session, spurted by another 106.57 points to close 16,042.18 as funds and general investors bought heavily into tech and PSUs stocks. This is the third successive gain for the market.

The wide-based National Stock Exchange index Nifty 50 also rose by 32.25 points to 4,792.65, after crossing the psychological 4,800-mark during the session.

After a weak start, the sentiment picked up and a fag-end buying influenced by a higher opening in Europe pushed the indices to record handsome gains.

With the buying activity picking up, barring realty and oil & gas sector, all BSE sectoral indices ended in the green.

Among the Sensex stocks, 19 ended higher, while 11 declined.

The information technology sector gained the most by rallying 2.52 per cent to 4,972.64 points led by Infosys as it rose Rs 70.15 to Rs 2,470.90, TCS by Rs 10.40 to Rs Rs 734.20 and Wipro by Rs 15.85 to Rs 652.45. Country's software service companies get a third of their sales in Europe.

The Sensex-linked Grasim gained Rs 123.10 to Rs 2,681.10 and ACC rose by Rs 27.25 to Rs 869.15 on expectations of better GDP expansion.

Brokers attributed early weakness to a severe setback on the Wall Street overnight with the Dow Jones Industrial Average sliding by 104 points and closing below 10,000-mark.

However, firm Asian markets helped the recovery in the domestic bourses. All the key indices, barring the Nikkei, which ended flat, like Shanghai, Hang Seng, Strait, Kospi and Taiwan closed with gains.

European markets too resumed better today. The CAC was up by 0.28 per cent, the DAX by 0.48 per cent and FTST by 0.60 per cent.

Brokers said fresh selling by funds in heavy-weight stocks mainly led to fall in the stock prices in the first half. Also though Asia and Europe were in the green, the sentiment was not so strong, hence our markets too could not hold on to higher levels, they added.

The 50-issue Nifty of the NSE also rose by another 32.25 points or 0.68 per cent to close at 4,792.65 after touching the psychological 5800 market many times intraday. This is the third successive gain for both the indices.

With the buying activity picking up, barring realty which dipped by dipped by 40.34 points or 1.21 per cent and oil & gas sector which fell 0.23 per cent, all BSE sectoral indices ended in the green. And among the Sensex stocks, 19 ended higher, while 11 declined with moderate to deep losses.

From the BSE sectoral indices, the IT spurted by 122.01 points or 2.52 per cent, Tech rallied by 2.09 per cent, and the PSU by 153.59 points or 1.67 per cent.

The Sensex gainers pack was led by Grasim which zoomed by 4.81 per cent, followed by ACC 3.24 per cent, Infosys by 2.92 per cent, Wipro by 2.49 per cent, Sun Pharma by 2.22 per cent, Rel Infra by 2.03 per cent, Bharti Airtel by 1.78 per cent, Hero Honda by 1.66 per cent, TCS by 1.44 per cent and L&T by 1.21 per cent.

And the losers list was topped by DLF which declined by 1.51 per cent, followed by Hindalco 1.40 per cent, M&M 1.07 per cent and HUL that shed 0.96 per cent.

The market breadth turned positive as 1,500 stocks ended with gains against 1,302 that finished with losses on the BSE.

It can be noted that, foreign institutional investors pulled out as much as Rs 935.55 crore from the markets yesterday, while the domestic institutional investors pumped in Rs 381.07 crore on the same day, according to the data available with the exchanges.

However, total trading volume was relatively low at Rs 4,508.11 crore from Rs 4,687.14 crore on Monday. Jubilant Foodworks remained the top traded counter with the highest turnover of Rs 329.20 crore, for the second day in a row following its stupendous listing yesterday, followed by Tata Steel (Rs 131.99 crore), STC (Rs 120.47 crore), Infinite Computers (Rs 112.26 crore) and Hind Copper (Rs 95.46 crore).