Markets pare gains

Markets pared some gains in noon trades after the government revealed inflation for the month of May to be higher than expected. The Sensex was up just 39 points at 18,305. Nifty advanced 19 points at 5,501.

India's wholesale price index (WPI) rose an annual 9.06% in May, driven by higher manufactured goods prices, government data showed on Tuesday.

The figure was above the median forecast for a 8.70% rise in a Reuters poll and was higher than the annual rise of 8.66% in April.

Reliance continued to be the major dragger and was down 1.5% at Rs 913. Tata Motors and Hindalco slipped 1-2% each. HDFC was down 1% at Rs 651.

Meanwhile, Reliance Infra, Bajaj Auto, Tata Power and DLF traded strong - up 1-2% each.
_____________________________________
(Updated at 1125 hrs)

Markets continued to trade in green on the back of buying in ICICI Bank and Larsen & Toubro. The index opened at the day's low of 18,277. Thereafter it touched a high of 18,380, but lost weight once again as RIL reversed direction. The index was trading sideways in late-morning trades - up 78 points at 18,344. Nifty was up 26 points at 5,509.

Asian markets gained as data from China showed an in-line consumer inflation reading and some stronger signals on the Chinese economy. Shanghai Composite jumped 1% to 2,727. Nikkei was up over 1% at 9,554.

Almost all the sectoral indices were in the green, led by realty, PSU and banking stocks. The BSE realty index gained 1% at 2,163, ahead of the inflation data for May 2011, due later today. DLF and Unitech, among Sensex stocks, led gains and were up nearly 2% each. HDIL, Parsvnath Developers, Sobha Developers were up 1% each.

The oil & gasindex dropped marginally on account of selling pressure on RIL. The stock slumped 0.8% to Rs 919 - falling for the second day on the oil sector regulator's decision to reject three new natural gas finds by the Mukesh Ambani-led company in the eastern offshore KG-D6 block as discoveries.. However, other stocks in the index remained in green. ONGC jumped 1.5% to Rs 273. Oil marketing companies - HPCL, BPCL and IOC were up in trades as well.

Among the Sensex gainers were Reliance Infra and Bajaj Auto - both up 2%. Sterlite India, Larsen & Toubro. Mahindra & Mahindra, ICICI Bank and Jindal Steel advanced 1-2% each. IT and FMCG stocks were up around 1% each.

HDFC fell 1% to Rs 650 after Citigroup reduced stake in the company. The counter witnessed hefty volumes of 17.27 million shares on BSE, as against a two week average of 113,000 shares.

BSE market breadth was fairly positive. Out of 2,504 stocks traded, 1,555 stocks advanced while 830 stocks declined.