Markets remain firm; WPI inflation at 4.86%

Markets edged higher in the afternoon session this Monday after country’s headline inflation eased for the month of June and remained within the Reserve Bank of India’s comfort zone of sub-5 per cent.

The Wholesale Price Index -based inflation rose to 4.86% in June, compared to market expectations of nearly 5% and 4.7% during the previous month.

At 2:30PM, the 30-share Sensex gained 76 points at 20,035 and the 50-share Nifty rose 20 points at 6,029 levels.

Sentiments improved further after China’s slowdown was not as worse as expected. China's second-quarter economic growth cooled to 7.5% versus a year earlier, from 7.7%, in line with expectations.

In Asia, Singapore Straits Times rose 0.05% to 3,237.67, China’s Shanghai Composite index was up 1% at 2,059 while Hong Kong’s Hang Seng gained 0.1% to 21,303 today. Japanese markets are shut today for a holiday.

European shares rose as China’s economy expanded in line with analyst forecasts. The yen weakened and commodities declined.

France’s CAC rose 1% to 3,888.92, Germany’s DAX gained 0.58% to 8,260 while UK’s FTSE was up 0.7% to 6,591.

Among the key sectoral indices, FMCG, consumer durables, capital goods, oil & gas and healthcare gained while power sector dropped on the BSE.

The gainers included counters such as Bharti Airtel surging 3.5%, Mahindra & Mahindra rose 2.5%, TCS gained 2.3%, Hindalco Industries added 2.2% while HUL was up 1.9% on the BSE.

The laggards were Tata Steel shedding 2.4%, Coal India was down 2%, Infosys declined 2%, NTPC shed 1.5% while Tata Motors fell 1.4% on the BSE.

The key notable movers included counters such as Opto Circuits (India) that has zoomed as much as 29% to Rs 29.40 in noon deals on NSE on back of heavy volumes.

A combined 22.05 million shares representing around 13% free-float equity of the company already changed hands on the counter till 1349 hours against an average sub 4 million shares that were traded daily in past two weeks on BSE and NSE. The stock opened at Rs 23.20 and hit a low of Rs 22.30 so far.

Shares of Tata Consultancy Services (TCS) and HCL Technologies have touched record highs today after information technology (IT) major Infosys retained its revenue growth guidance in dollar terms for the year ending March 31, 2014 (FY 2014).

The broader markets traded higher with mid-caps and small-caps gaining 0.6-0.7 per cent on the BSE.

The market breadth was positive. Out of 2,306 stocks traded so far, 1,251 stocks advanced while 956 stocks declined on the BSE.