Positive momentum continues, Sensex up 140pts

Markets were trading firm in the afternon session after giving up all the gains, after the Reserve Bank of India increased key rates by 25 bps, along the expected lines. The Sensex was up 144 points at 17,024, while the Nifty advanced 40 points, at 5,114.

Earlier, the markets opened on a positive note after central banks around the world pledged to pump in liquidity into the system. The Nifty touched a high of 5,143 around noon and gave up all the gains, touching a low of 5,068 after the rate hike announcement and the continued hawkish stance of the central bank, leaving room for more rate hikes going forward. However, the markets recouped most of the losses.

In the international markets, all the Asian indices closed in the positive today with exporter and financial shares leading the gains. The South Korea’s Seoul Composite and Taiwan Weighted index were leading the gains, up 34%. The Hang Seng and the Nikkei gained 12% each. The Shanghai Composite index closed flat, up 0.1%.

The European markets also extended Thursday’s gains ahead of Euro-zone finance ministers meet in Poland to discuss the debt crisis. The CAC gave up all the gains and was down 0.3%, while the DAX and the FTSE were up 0.4-0.7% each.

Back home, among the pectoral indices, FMCG and IT indices were trading in the negative during afternoon trades.

Top losers from the IT pack were Core Projects, down almost 3%, Oracle Finance declined over 2% and HCL Technologies slipped over 1%.

Prominent losers from the FMCG pack were Hindustan Unilever, down over 2%, Nestle India slipped 0.8% and Tata Global was off 0.5%.

BSE PSU index was the top gainer up 2%. Top gainers from the PSU space were J&K Bank, up 6%, followed by ONGC and NMDC, up almost 5% each.

Top gainers on the Sensex were ONGC, Sterlite, Hindalco, NTPC, Tata Power and L&T advancing 2-6%. Hindustan Unilever, Tata Steel, Jaiprakash Associates and Infosys were the key losers among the Sensex stocks, down 1% each.

The market breadth was negative. 1351 stocks declined, while 1284 advanced in the afternoon trades.