Market near day's highs; Nifty reclaims 7,300

Markets extended gains to trade near their day's highs led by L&T

Markets extended gains to trade near their day's highs led by gains in Larsen & Toubro after the engineering major posted robust Q4 earnings.

At 11:50AM, the 30-share Sensex was up 308 points at 24,526 and the 50-share Nifty was up 92 points at 7,322.

The Indian rupee was trading marginally lower at Rs 59.12 compared to its previous close of 59.10 as traders remained cautious ahead of the RBI's monetary policy review on Tuesday.

Asian markets were trading mixed with the Nikkei surging over 2% on the back of robust manufacturing data from China and rise in corporate spending by Japanese corporates during the first quarter of 2014.

According to the official data released, activities in Chinese factories was the highest in the five months to May on the back of increasing order inflows.

Further, government data showed that Japanese corporates increased capital expenditure in the first quarter (Jan-Mar) 2014 by 7.4% compared to the same quarter in 2013.

Nikkei was up 2% while Straits Times and Hang Seng were up 0.1-0.3% each while Shanghai Composite was trading flat with negative bias.

BSE Capital Goods index was the top gainer up 4.7% followed by Oil and Gas, Bankex, Power and Metal indices.

L&T was up 6% at Rs 1,641 after the engineering major reported 69% growth in net profit for the quarter ended March on the back of improved operational performance, higher sales and an exceptional income of Rs 484 crore from dilution of its stake in L&T Finance. PSU engineering major BHEL was up 2.4% at Rs 248.

Financials were among the top gainers ahead of the RBI's monetary policy review tomorrow. HDFC Group shares, HDFC and HDFC Bank were also up 2% contributing the most to the Sensex gains. ICICI Bank and Axis Bank were also up 1-2% each.

In the oil and gas space Reliance Industries and ONGC were up 1.4-2.4% each.

Infosys rebounded today after the sharp correction last week and was up 1.5% on talk that former SAP board member Vishal Sikka is certain to be chosen as the new CEO of Infosys.

Telecom stocks firmed up today on reports that some of the mobile service providers have hiked rentals of post-paid services while others have reduced benefits and validity for select schemes. Bharti Airtel was up 2%, Idea was up 1.4% and Reliance Comm was up 2.5%.

FMCG majors ITC and Hindustan Unilever were among the top Sensex losers down 1.2-1.7% each.

Among other shares, Ruchi Soya dipped 3.9% to Rs 42.3 on the BSE after posting a net loss of Rs 19.65 crore in the quarter ended March 2014 as against net profit of Rs 78.59 crore during the previous quarter ended March 2013. Sales of the company declined 16.08% to Rs 6308.07 Crore in the quarter ended March 2014 as copared to Rs 7516.47 crore during the previous quarter ended March 2013.

In the broader market, the BSE Mid-cap and Small-cap indices were up 1.5-1.6% each.

Market breadth was strong with 1,702 gainers and 840 losers on the BSE.