Markets pare gains; metals shine

Markets pared gains in mid-morning trades to touch the day's low.

The Sensex started the first trading session of 2011 on a good note and touched a high of 20,665. However, it pared some of its gains and touched a low of 20,604.

Nifty gained up 25 points at 6,160.

Asian markets were trading in the green this morning amid signs that the labour market is improving in the world biggest economy. Hang Seng added 1.3% to 23,354. Straits Times advanced 1% to 3,228. Markets in China and Japan remained shut.

This week the markets will be looking towards certain important data for direction. Exports, import, food articles WPI (YoY), Fuel Power Light WPI (YoY), primary articles WPI (YoY) and auto sales  numbers will be coming out this week.

Metal and auto stocks shone in the morning session. Metal index added 1.7% to 17,895.

Sterlite was the biggest Nifty gainer and jumped 2.6% to Rs 192. Sesa Goa jumped 2.5% to Rs 337. Sail and Tata Steel were up 2% each.

Auto stocks gained on of announcement of the sales figures. Mahindra & Mahindra added 2% to Rs 794. Hero Honda was up 1.2% at Rs 2,014.

Reliance Communications, DLF, Jaiparaksh Associates and IDFC were among the other gainers.

Meanwhile, Bharti Airtel dipped 0.6% in trades to Rs 356. Larsen & Toubro, NTPC and Cipla were down marginally as well.

Kotak Mahindra Bank rose 1.01% after bank raised its base rate to 8.25% per annum from 8%.

Last week, food price index rose 14.44% while the fuel price index climbed 11.63% for the week ended 18 December 2010.

BSE market breadth was positive. Out of 2,618 stocks traded, 2,010 advanced while 539 declined.