NEW DELHI: Positive developments on the US-China trade war front and Sensex rejig were among the key reasons for a rally in domestic equity market.BSE benchmark Sensex jumped 470 points to trade at 40,829. The index also hit a new lifetime high of 40,857.73 during the day. Its NSE counterpart Nifty soared 141 points to 12,056.Metal stocks jumped as Tata Steel added 4.83 per cent to RS 418.90 while Vedanta was up 2.81 per cent to Rs 146.15 on BSE. BSE Metal index gained 3.13 per cent to 9,670.77.Among other Sensex gainers were Bharti Airtel up 5.7 per cent to Rs 444.95 and IndusInd Bank up 2.6 per cent to Rs 1,484. HDFC was the biggest index contributor with 91 points.Key factors behind the rally:Sentiments improved on Dalal Street after reports said the US and China could sign a deal before the year ends. A senior US official over the weekend said an initial trade agreement is still possible by the end of the year, after Chinese President Xi Jinping and US President Donald Trump both underscored their desire on Friday to sign a deal.The prolonged trade war between the world’s leading economies have been weighing on the market and economies. The resolution of the conflict may boost growth.BSE on Friday announced some changes to the composition of its flagship Sensex. The exchange has decided to remove Tata Motors, Tata Motors DVR, YES Bank and Vedanta from the index to make space for UltraTech Cement , Titan and Nestle India. This will be effective from December 23.YES Bank has been one of the biggest disappointments in recent months as far as the stock market performance is concerned. It has dived 65 per cent year-to-date. SImilarly, Tata Motors is down 4 per cent YTD, Tata Motors DVR (17.9 per cent) and Vedanta (28 per cent) in comparison of 13 per cent gain in Sensex.Foreign investors poured over Rs 5,000 crore into the Indian equity market on Friday, as per data available on NSDL. Net inflows in the last week was at Rs 2,683.96 crore. Overall, FIIs have largely been bullish on the Indian market in November, investing Rs 17,548 crore.A cautious rally in Asian markets also buoyed domestic stocks. MSCI 's broadest index of Asia-Pacific shares outside Japan bounced 0.7 per cent, after losing 0.4 per cent last week. Japan's Nikkei firmed 0.7 per cent, while Australian stocks rose 0.5 per cent and Shanghai blue chips 0.3 per cent. Heng Seng also gained1.5 per cent. Most European markets also opened with gains. FTSE added 0.7 per cent while CAC gained 0.6 per cent and DAX was up 0.5 per cent.Nifty50 appears to have embarked on a fresh leg of rally as it erased the last two sessions of losses witnessed from the highs of 12,038-11,883 levels in just one stroke, said Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in.Hence, sustaining above 11,919 it should ideally test its life time highs placed around 12103. But beyond that in best case scenarios we can expect a target of 12350-400 levels. One can continue to retain a positive outlook as long as Nifty sustains above 11919 levels which can be ideal stop for fresh long positions on closing basis.