Sensex of the Bombay Stock Exchange shot up by 84 points to 4705.13 from 4621.00. On the other hand, S&P CNX Nifty Index of the National Stock Exchange gained by 40.65 points to touch an all-time high of 1371.90 before closing at 1363.35 against the previous close of 1322.70. The sustained rally in the market ahead of the elections has perplexed market analysts.

With Wednesday's rise, Sensex had gained by 217 points in the last three trading sessions. However, investments by FIIs on the Indian bourses continued to be negative in the current month. According to daily trends of FII investment released by the Securities and Exchange Board of India (SEBI), FIIs were netsellers to the tune of Rs 200 crore during the period of August 2-17. During the period gross purchases made by the FIIs stood at Rs 1279 crore as against their gross sales worth Rs 1479 crore, the SEBI stated. ``This shows that FIIs are not behind the bull run. Speculators are building up positions based on initial poll surveys,'' said a broker.

A major reason, according to a market player, is that the speculators and the retail investors are already factoring in a BJP victory along with stable allies in the coming elections and this is one of the reasons for the recent bullish fervour in the markets. ``There is not much uncertainty in this election. There may not be a hung parliament this time,'' said a fund manager.

However, FIIs have started giving more weightage to countries like Malaysia. This means funds which would have come to India would be diverted to these markets. According to a BSE director, FIIs are actually going out as the world markets expect an interest rate hike announcement by the USFederal Reserve.

The reshuffle in the A Group of BSE was another bullish factor. ``The reshuffle is going to change the outlook of the market vis-a-vis the 27 new A Group entrants as these are already being re-rated. Combined with the rally in the stocks promoted to group A, the results from the recent exit polls, indicating a majority for the BJP and its alliance in the coming elections. No bad news from the Indo-Pak border also had a positive effect on the markets. Besides, the fundamentals also remain good,'' said an operator.

Brokers said the fresh rally on Wednesday was also due to start of the new account on the National Stock Exchange where operators entered into new commitments. Bulls created long positions in several scrips in line with FIIs who were reportedly net buyers in economy stocks like TISCO, TELCO, MTNL, BPCL, HPCL, M&M and Tata Power besides ITC, Zee Telefilms and pharma scrips like Dabur, Ranbaxy, Novartis, Rhone Poulenc and Wockhardt. Of the 149 specified shares, 109 scored sharp tomoderate gains while 36 moved down and four remained unchanged. ITC was the most active scrip with a turnover of Rs 210.98 crore of the total volume of business of Rs 2423.82 crore. The market leader ITC flared up by Rs 59.95 to Rs 1013.95. Ranbaxy spurted by Rs 16.90 to Rs 1004.90, TELCO by Rs 14.45 to Rs 291.50, RIL by Rs 2 to Rs 174.50, Zee by Rs 78 to Rs 2650, TISCO by Rs 6.15 to Rs 145.10, SBI by Rs 4.75 to Rs 245.60 and HLL by Rs 6.50 to Rs 2611.55.

Meanwhile, a number of illiquid scrips, too, have started trading regularly and have attracted huge buying interest. In the relatively more liquid B1 group, almost 200 stocks out of the 750-odd scrips have breached their respective 52-week highs.