Markets erase early gains

Markets have erased early gains and have turned volatile with Sensex and Nifty swinging between negative and positive zone. Markets were firm during early part of the day as investors ignored the sudden contraction in November industrial output and remained bullish on riskier assets after upbeat Infosys' third quarter results.

By 1300, Sensex gained by 45 points at 19,708, and the Nifty was flat at 5,968 levels.

On the global front, Asian markets traded mixed as China’s inflation accelerated and Japan approved 10.3 trillion yen ($116 billion) of stimulus measures.

Hong Kong's Hang Seng fell 0.31% to 23,281, Taiwan's Weighted index fell 0.1% to 7,805, Singapore’s Straits Times was down 0.4% to 3,213. Also China's Shanghai Composite declined 0.86% to 2,263 while Japan's Nikkei rose 1.4% to 10,805.

Back home, BSE IT index has surged by almost 8%. However, BSE FMCG, Oil & Gas, Power, PSU, Realty, Capital Goods and Bankex indices have declined by 1% each.

Shares of information technology (IT) companies are in focus after Infosys has reported a better-than-expected net profit for the third quarter ended December 2012 (Q3) and upped its full year guidance.

Infosys has rallied 13% to Rs 2,628, its sharpest single day gain in past one decade on the Bombay Stock Exchange (BSE). Tata Consultancy Services (TCS), Wipro, Mahindra Satyam, Hexaware Technologies, CMC and Tech Mahindra are trading higher by 2-4%.

However, FMCG majors HUL and ITC have plunged between 2-3%.

Financial and banking majors like HDFC, SBI and ICICI Bank have slipped between 1-2%.

Other prominent losers include ONGC, Sun Pharma, Tata Power, M&M, Bharti Airtel, BHEL and Hindalco.

The market breadth in BSE remains weak with 1,691 shares declining and 953 shares advancing.