A deluge of buying interest throughout the holiday-truncated week resurrected the markets from the malaise of the previous month. Snapping the tumultuous five successive weeks of losses, the Sensex bounced back in style to surge by 972 points or 6.1% to 16,821 and ditto with the Nifty, which jumped 292 points or 6.1% to 5,040. The mid-cap index rose 4.8% at 6324 and small-cap index rose 3.2% at 7133. The metal index soared by 11.5% at 12,549, while the realty index jumped by 10% at 1,769 and banking index gained by 6.8% at 10,949.

The market got off to a flying start on Monday on receding fears of recession in the US following an optimistic assessment of the US economy by Fed chairman Ben Bernanke on August 26. The end of a standoff between the government and anti-corruption crusader Anna Hazare over the previous weekend also aided the positive sentiment.  The BSE Sensex jumped nearly 600 points and there was no looking back from thereon.

The strong Q1 June 2011 GDP growth data maintained the tempo on Tuesday; the Sensex jumped by another 260 points as the latest data showed that the economy expanded 7.7% in Q1 June 2011 from a year earlier, helped by strong growth in the services sector. The manufacturing sector grew an annual 7.2% in Q1 June 2011 and farm output rose an annual 3.9%, the data showed.

Neither the holidays bang in the middle of the week nor the double-digit food inflation numbers were enough to break the momentum. The markets were shut on August 31 on account of Ramzan and September 1 due to Ganesh Chaturthi. And food inflation touched the double-digit mark after a gap of over five months. It was at 10.05% for the week ended August 20, as onion, fruits, vegetables and protein-based items turned expensive. The prices of onion soared by 57.01% year-on-year, while that of potato rose by 13.31% during the week under review.

Taking from where they had left, the key benchmark indices logged gains for the third consecutive session on Friday as domestic bourses played a catch-up with their global peers to sign off what was the best week in the past two years.

India's largest real estate developer by market capitalisation DLF jumped 18.28% to Rs 208 to top the gainers list on the BSE on plans to sell its holding in the joint venture company which is undertaking the DLF IT Park, Noida project. Tata Steel gained by 15.6% at Rs 488 post its steep recent fall triggered by concerns the ongoing euro-zone debt crisis will impact its European operations. And index heavyweight RIL recovered from a 52-week low of Rs 713.55 touched on August 26 to advance 11.9% to Rs 805 after announcing the completion of BP's acquisition of a 30% stake in 21 oil and gas production sharing contracts that RIL operates in the country, including the KG D6 block.

In the midcap index, Manappuram Finance soared by 29% at Rs 56, Glodyne Technology raced ahead by 17.7% at Rs 321 and State Bank of Mysore added 17.4% at Rs 670. And the smallcap space saw the likes of Fineotex Chemicals jumping by 29.4% at Rs 328, ICSA India gaining 21.8% at Rs 77 and Man Industries adding 20% at Rs 149.

In the metals space, JSW Steel topped the gainers charts by adding a whopping 18.5% at Rs 720. Tata Steel gained 15.6% at Rs 488 and Jindal Steel added 13.6% at Rs 525. Sesa Goa, Hindustan Zinc and Hindalco added between 10% and 12% each. DLF soared by 18.2% at Rs 208 to take the realty space by storm. Among the other prominent gainers in this space, Parsvnath Developers gained by 17.4% at Rs 54 and Phoenix Mills added 10.4% at Rs 219. The banking space saw ICICI Bank jumping by 8.1% at Rs 887, Yes Bank gaining 7.5% at Rs 278 and HDFC Bank adding 7.4% at Rs 471.

In an indication of the buying fury that gripped the markets during the week gone by, ONGC was the only Sensex stock to end the week in the red, shedding 5% at Rs 263.

The next week would reveal whether the corrective rally still has some steam left on the upside. However, the developments on Wall Street on Friday do not augur well for Monday's market opening back home. US stocks tumbled 2% after data showing zero jobs growth in August brought investors face-to-face with the prospect of another recession. The Dow Jones sunk 253 points and Nasdaq Composite was down 65 points on the last day of the week. Moreover, the markets will also start factoring in the outcome of the next scheduled on September 16.  In the last policy meet, the central bank had hiked the repo and reverse repo rates by 50 bps each, more than market expectations.