The markets have spurted in noon trades on the back of a drop in food inflation to a two-month low. The Sensex is quoting at 18508, higher by 207 points and the Nifty is comfortably above the crucial 5500 mark at 5546, up 64 points. The midcap index is at 6797, higher by 62 points and the smallcap index is at 8335, up 85 points.
The markets had started the day on a muted note in line with the cues from the global front and the subdued nature of the previous day's proceedings. But they picked up momentum mid-way through the session to scale new intra-day highs with every passing hour as the easing of food inflation boosted the interest-rate sensitive banking and auto stocks.
The food inflation eased to a two-month low in early February on moderating prices of onions and other vegetables, amid expectations the government may announce fresh measures to boost productivity for key staples in the upcoming budget. Food inflation eased to a two-month low in early February 2011 on moderating prices of onions and other vegetables. The food price index rose 11.05% and the fuel price index climbed 11.92% in the year till February 5, government data showed. In the previous week, the annual food and fuel inflation stood at 13.07% and 11.61% respectively. The primary articles price index was up 14.59% in the latest week, compared with an annual rise of 16.24% a week earlier.
The banking index has jumped by more than a percent to lead the list of sectoral gainers on the BSE. In the banking space, HDFC Bank has spurted by 4.2% at Rs 2186, HDFC has soared 2.8% at Rs 647 and ICICI Bank had added 1.1% at Rs 1065. L&T, Bharti Airtel and Tata Steel are the other significant gainers on the BSE.
On the other hand, Wipro has slipped by 0.8% at Rs 433 to emerge as the top loser on the BSE. ONGC has shed 0.5% at Rs 278 and Cipla has lost 0.4% at Rs 304.
The market breadth is positive. Out of 2878 stocks traded on the BSE, there are 1759 advancing stocks as against 1016 declines.
