Market opens higher on profit hunting

Markets opened higher as investors look at entering stocks after the recent correction post hitting new highs

Market opened higher on Tuesday with benchmarks opening higher as investors are look to build long positions at lower levels in frontliners. But the market expected to trade sideways as investors remain wary of key central bank policies in both US and India.

The 30-share BSE Sensex opened at 20,746 levels up by over 90 points while 50-share NSE Nifty was up 31 points at 6185 levels in opening trade.

The Reserve Bank of India (RBI) announces Mid-Quarter Review of Monetary Policy for 2013-14 tomorrow, 18 December 2013.

Whole Price Inflation (WPI) inflation numbers, announced earlier, increased 7.52% yoy in November 2013 led by a 19.93% yoy inflation in primary food products and 11.08% yoy inflation in fuel and power. Even the Consumer Price Index (CPI) based inflation, announced earlier for October 2013 rose to 11.24% yoy (October 2013:10.2% yoy).

Market pundits now expect RBI to increase the repo rate by  25bps in its forthcoming policy.

A majority of economists expect the taper to happen in March, but a recent run of upbeat economic data has steadily raised the odds for an announcement at this week's two-day meeting concluding on Wednesday, or in January.