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Markets opened higher led by rate sensitive shares with financials leading the gains after April wholesale price inflation which eased to a 41-month low of 4.89% rekindled hopes of a rate cut by the central bank.
The Sensex is up 233 points at 19,956. Nifty is up 67 points at 6,063. Going forward, markets are likelyto be rangebound in the absence of any major global cues.
The headline inflation fell to 4.89 per cent in April, within the Reserve Bank of India (RBI)’s comfort zone for the first time in almost three-and-a-half years, fuelling market hopes for more interest rate cuts to revive economic growth. RBI’s comfort level for inflation is between four and five per cent.
US stocks rallied to fresh highs on Tuesday as investors picked up large-cap companies' shares on the expectation that central bank stimulus will help propel the rally further. The Dow Jones industrial average gained 0.82 per cent, while the Standard & Poor's 500 Index rose one per cent.Asian shares were steady on Wednesday, with Nikkei gaining over 2 per cent to a fresh five-and-a-half year high as Japanese exporters rallied on the yen's sharp slide.
BSE realty index has added 1.7% at 1,912. Bankex and capital goods indices are also in the green. Among other gainers are auto and oil & gas shares. However, the IT index has slipped marginaly in red to trade at 5,965.
HDFC bank was up 2.8% at Rs 894. Other financials are also up. SBI and HDFC Bank have gained 2% each to Rs 2343 and Rs 703, respectively. Hero MotoCorp, Tata Motors and Larsen & Toubro were up as well. However, Infosys and TCS are down marginally in trades.
Among individual stocks, Whirlpool has slipped 1% to Rs 206 after reporting a 33.4% decline in its net profit at Rs 24.75 crore for the quarter ended March 2013. Meanwhile, Dr Reddy's Laboratories has gained 1% at Rs 2049 on reporting 66.58 per cent rise in its net profit for the January – March quarter.
IVRCL’s transportation and building division has bagged orders worth nearly Rs 639 crore. Shares of IVRCL are up 2% at Rs 19.65.
BSE market breadth is positive. Out of 1302 stocks traded, 910 shares have advanced while 324 shares have slipped.
