Sensex up for 2nd day; Infosys results, IIP key

The BSE Sensex and the NSE Nifty rose on Thursday to a one-week high, marking a second straight session of gains. Infosys continued to gain ahead of its quarterly results tomorrow, while ICICI Bank rose on attractive valuations after recent steep falls.

Gains also came after both the Dow and the S&P 500 ended at record highs, while Asian shares were further underpinned by data showing a surge in local currency loans in March.

Analysts expect the near-term trend to be determined by Infosys' fourth-quarter results tomorrow, setting the tone for the January-March earnings results season, and also industrial production data, which probably shrank in February.

A consensus forecast by a Reuters poll of 26 economists showed factory production likely fell by 0.7 per cent in February on a year earlier, due to a contraction in infrastructure industry output and flagging demand, after a surprisingly strong rise in January.

"Infosys results, expected to surprise the market positively, and IIP numbers would be the near-term catalysts for the market," said Deven Choksey, managing director of KR Choksey Securities.

Some buying is happening at lower levels as benchmark indexes have come close to support at 5,500, added Choksey.

The Sensex rose 0.69 per cent, or 127.75 points, to end at 18,542.20, marking its highest close since April 4.

The Nifty rose 0.64 per cent, or 35.30 points, to end at 5,594, its highest close since April 3.

Foreign investors paring some holdings in last few sessions, due to lingering concerns on domestic economy and political instability, led the benchmark indexes earlier this week to their lowest close since the government's "big bang" reforms in September sparked a powerful rally.

Economists polled for the latest quarterly survey lowered their growth forecast for Asia's third largest economy for the eighth consecutive time.

Gross domestic product will increase six per cent in the current financial year to March 2014 after it grew at a decade-low of five per cent in the previous financial year, according to a median forecast of 27 economists. Tech shares gained for a second day as previous losses are seen as overdone: Infosys rose 3.6 per cent ahead of fiscal 2013 earnings.

HCL Technologies Ltd rose 3.3 per cent, while Tata Consultancy Services ended 0.4 per cent higher.

HCL may be the only one among India's big four IT stocks to beat January-March earnings consensus forecasts, according to Thomson Reuters StarMine data.

StarMine's SmartEstimates shows HCL Tech would report an EPS of Rs 13.34 for the quarter, compared with mean consensus estimates of Rs 12.48. SmartEstimates measures the forecasts of only top-ranked analysts. By contrast, Infosys, TCS and Wipro are expected to slightly underperform consensus forecasts, according to SmartEstimates.

ICICI Bank Ltd gained 3.6 per cent as valuations started looking attractive to many after it fell 15.7 per cent between January 31 and yesterday, dealers said.

Tata Motors Ltd rose 3.8 per cent on hopes unit Jaguar Land Rover Ltd would report solid global wholesales for March.

Titan Industries Ltd gained 0.6 per cent after Jefferies upgraded the stock to "buy" from "hold" and raised its target price to Rs 296 from Rs 288, saying recent concerns about increased regulatory scrutiny on gold lending and the demand environment are overdone.

Kingfisher Airlines rose 4.6 per cent after the grounded airline gave a plan yesterday to the aviation regulator to restart operations, saying its parent group would provide initial funding and asking for its flying licence to be renewed.