Markets ended Tuesday's session on a strong note. The 50-share Nifty clsoed above the crucial psychological level of 5,400. The index advanced 55 points to provisionally close at 5,421 and the Sensex jumped 193 points to end at 17,884.
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(Updated at 1430 hours)
Markets continue to trade firm in late noon trades, amid positive global cues, led by gains in Infosys and HDFC. At 2.30 pm, the Sensex was up 103 points at 17,794 and the Nifty gained 28 points at 5,394.
In the broader markets, the midcap index up 0.1% underperformed teh smallcap index up 0.4% and the Sensex up 0.5%.
In the Asian markets, Japan's Nikkei share average retreated from a three-month high on Tuesday on creeping doubts over the European Central Bank's plan to tackle the region's debt crisis, although investors buying defensive stocks offered some support to the market.The index lost nearly 0.2% along with Kospi Composite.
European shares and the euro edged higher on Tuesday on optimism that meetings on Greece's future and a strategy being drawn up by the European Central Bank will lead to progress in solving the euro zone debt crisis.CAC, DAX and FTSE gained between 0.6-0.8%.
Back home, the government announced that the July CPI stands at 9.86% y-o-y. The country's annual consumer price inflation slowed slightly in July helped by a drop in petrol prices at the pump, government data showed on Tuesday, but a drought in parts of the country pushed food prices higher.
Meanwhile, the rupee rose by 24 paise to trade at 55.49 against the American currency in early trade today at the Interbank Foreign Exchange on continued dollar selling by exporters and some banks.
On the sectoral front, BSE IT, Realty, Power and Auto indices gained nearly 1-1.5% each. However, Banks, Consumer Durable, Metal and Capital Goods were trading with a negative bias.
From the IT space, Infosys gained over 2% after a U.S court dismissed harassment charges filed by a U.S. employee, ending worries about a case that had recently pressured shares of the software service exporter. TCS and Wipro have gained by almost 1% each. TCS advanced 1%.
Among Auto segment, Tata Motors, M&M, Bajaj Auto and Maruti Suzuki gained between 1-2%. Tata Motors extended Friday's 2.12% gains triggered by the company reporting strong global sales in July 2012.
HDFC was the top Sensex gainer, up over 2.5%. Other notable gainers include NTPC, Sterlite, HUL, Cipla, Gail India and ICICI Bank up 1-2%.
On the losing side, Hindalco was the top Sensex loser, down nearly 2.5% on reports that the Odisha State Pollution Control Board (OPSCB) has asked the company to shut down the captive power plant (CCP) of smelter plant near Hirakud in western Odisha in the wake of a breach in the company's ash pond that damaged standing crops in the locality.
Other notable losers include Hero Moto, Bharti Airtel, HDFC Bank, Tata Steel, and ITC losing 1% each.
Among other stocks, Claris Lifesciences gained 2% after the USFDA approved the corrective actions taken at its plant in Ahmedabad thereby paving way for resumption of exports to the American market.
Shares of tyre manufacturers are trading higher up to 12% after the natural rubber prices hit twenty-three month low, which may boost profitability of tyre companies.Among the individual stocks, Ceat soared 12% at Rs 122 along with JK Tyre and Industries ralling 10% to Rs 119, followed by Falcon Tyres (up 8%), Goodyear India and Apollo Tyres (up 3% each) and MRF by 2% on the BSE.
The market breadth was marginally positive on BSE. 1389 stocks advanced while 1345 stocks declined.