Markets extend gains in late morning deals

Retail shares drop, IT and banks in green

Markets continued to extend gains in late-morning deals, mirroring cues from the global peers. The Sensex gained 118 points to 17,531. Nifty is up 37 points at 5,319.

On the domestic front, the Finance Minister P Chidambaram’s assurance for a review of the retrospective amendments to the Income Tax Act and new measures to attract investment in Mutual Funds has boosted investor sentiments.

In Asian markets, Japan's benchmark Nikkei has gained 0.7%, followed by Hang Seng. Markets across Asia moved up amid fresh hope for European action to support the region’s weaker economies.

BSE IT index has gained 1.3% to 5,415. Auto, bankex, realty and metal indices are up around 1% each.

Tata Motors has jumped 3% to Rs 236. Bajaj Auto has moved up 1.6% to Rs 1,660.

"Tatamotors daily price chart exhibits a classic pattern, It formed a minor inverse head and shoulder formation leading to a target of 236, which got achieved today. We have been bullish on the stock since 220 levels, and would advice short term trader to book full profits at these levels. I think if the stock manages to cross 242 levels and trade above that comfortably, one can look to go long again. But this range of 236-242 could act as a crucial range for a short term trader. Above 242 one can look for a target of 260 levels," said Kunal Bothra, Technical Analyst, LKP Securities.

Banking shares ICICI Bank and SBI are up 1.6% each. IT and metal names - Infoys, Jindal Steel, TCS and Hindalco are among the key gainers.

However, market heavyweight - Reliance is witnessing some profit booking and is down 0.3% at Rs 783. Hero MotoCorp has slipped 1.5% to Rs 1,950.

Among individual stocks, retail sector stocks are in focus today after Fitch Ratings has revised the outlook for the Indian retail sector for the second half of this year from stable to negative. Welspun Global has dropped 3.3% while V2 Retail is down 1.7%.

Pipavav Defence and Offshore Engineering Company has bagged two international orders worth Rs 1,192 crore. The stock is trading flat at Rs 61.