Nifty facing stiff resistance at 5,400

ITC, Infosys, Tata Motors lead gains

Benchmark share indices were trading firm in late morning trades on Friday, amid firm Asian cues and positive comments from German Chancellor, led by index heavyweights and Tata Motors.

Markets are witnessing profit taking at higher levels on account of the extended weekend with markets closed for trading on Monday for the festival of Id. The 30-share Sensex was up 120 points at 17,777 and the Nifty was up 29 points at 5,392 after touching an intra-day high of 5,398.70 so far.

Asian markets too advanced after German Chancellor Angela Merkel voiced support for the European Central Bank's efforts to contain the debt crisis in the euro zone. The Nikkei was up 0.9% and the Hang Seng gained 0.5%.

Among the sectoral indices on the BSE, FMCG, Auto, IT and Healthcare were the top gainers up between 0.7-1.5%.

ITC was up 1.7% at Rs 263 on buying support at lower levels after the stock witnessed selling pressure yesterday on concerns about regulatory action at home after reports that Australian court has approved logo ban on tobacco packs from December 1.

Software exporters such as Infosys, Wipro and TCS were up 0.7-1.5% on back of positive economic data from the US. All these companies earn a major portion of their revenues from exports to the US.

Index heavyweight Reliance Industries extended gains and was up 0.7% after the company recently said that it has proposed to drill the first exploration well in almost five years in the flagging KG-D6 gas fields in an effort to reverse the falling output. The report by Goldman Sachs that RIL can potentially become a $100-billion in market capitalisation by 2016-17 also boosted sentiment.

Tata Motors was the top Sensex gainer up 2.4% at Rs 241 after the auto major on Thursday said that global sales, including for luxury unit Jaguar Land Rover, were up 21% in July.

Maruti Suzuki was up 1% at Rs 1,186 on reports that the company would lift the month-l ong lockout and resume production at the violence-hit Manesar unit from August 21.

In the financial segment, mortgage lender HDFC and India's largest lender SBI were both up 1% each.

Larsen & Toubro was the top Sensex loser down 1.2% followed by Tata Steel and Hindalco.

In the broader market, both the BSE Small-cap and Mid-cap indices were up 0.7% each.

Among other stocks, KSL and Industries has locked upper circuit of 10% at Rs 62.75 on reports that the textile firm has settled a court dispute with holders of its foreign currency convertible bonds (FCCBs).

The market breadth was very positive with 1451 stocks advancing and 922 stocks declining on the BSE.