While the buying was concentrated on second rung stocks in the specified list, it was ITC and Hindustan Lever which helped Sensex to close higher. On the National Stock Exchange, ITC rallied upto Rs 738. On the Bombay Stock Exchange, it closed at Rs 730. Since the stock has moved above the Rs 726 level, which was the resistance level, the closing seems bullish for ITC and suggests a further upmove on Wednesday.

Much against the expectations, Hindustan Lever also clocked a gain of Rs 25. While the short-term outlook is yet to improve drastically, everything would depend on how the market reacts to the company's third quarter results. A sharp jump in volumes on Tuesday suggests a positive trend. Volumes have shown a three-fold jump from 1.41 lakh shares to 3.86 lakh shares on the BSE.

Now since both the heavy weights -ITC and HLL - are pointing towards a positive outlook, the chances for the Sensex to remain firm are greater. Similarly, the position of other important counters for Sensex is also decent if not bearish.

Reliance is on a good wicket and can maintain the uptrend. Although SBI closed lower on Tuesday, it can recover sharply after a weak start. ACC, Telco, and L&T are continue to look good. As it was mentioned on Monday, the rally on the counter of ACC can last for some more time and touch Rs 980. On the counter of L&T, profit taking will be witnessed only once it touches Rs 168. The position of Telco is similar. Tisco may witness profit-taking around Rs 84.

Among the other important counter, position of Bajaj Auto, MTNL and Hindustan Petrol is not so encouraging. MTNL is expected to remain bearish. As far as Bajaj Auto is concerned, it has been showing a mixed trend, and will follow the Sensex move. On the counter of Hindustan Petrol no action is expected.

Overall, the Sensex is expected to remain firm.Even if it declines, the fall will not be sharp and will be followed by a rally. As such, traders are advised to avoid short-selling on Wednesday. Those who are interested in profit-taking, they can wait for one more day.

Among the specified list, stocks like Apollo Tyres, Arvind Mills, Bombay Dyeing, Crompton Greaves, IPCL and TVS Suzuki will continue to remain firm. A decline is expected on counters like Carrier Aircon, Cadbury, BASF, Nocil and Sesa Goa.