Sensex edges up in cautious trade; elections eyed

By Indulal PM

MUMBAI (Reuters) - The BSE Sensex edged up and the Nifty recovered slightly from the 1-1/2 month closing low hit in the prior session, as investors picked up some of the battered stocks but also continued to book profits ahead of crucial election results next week.

The Nifty is down 3.1 percent since hitting a record high on April 25, as investors have reduced some of their positions ahead of the conclusion of elections.

Overseas investors sold index futures worth 5.12 billion rupees ($85.25 million), turning sellers for the six out of the last seven sessions.

Still, markets are overwhelmingly pricing in a victory by the opposition Bharatiya Janata Party, which is widely seen in markets as being more investor friendly.

 

"Market is preparing for the election outcome. We can see selective profit-taking and selective position building. Market continues to trade cautious and we will see a definitive directional move after the election outcome," said Suresh Parmar, head of institutional equities at KJMC Capital Markets.

The benchmark BSE Sensex gained 0.1 percent to 22,344.04, while the broader Nifty ended 0.11 percent higher at 6,659.85.

Shares got some support from Asian markets, which gained on dovish comments by the U.S. Federal Reserve chair Janet Yellen and upbeat Chinese trade data that suggested some signs of stabilisation in the world's second-largest economy.

Some recently battered shares rose, with Wipro Ltd gaining 0.96 percent after losing 11.6 percent since April 16 till Wednesday.

Metal stocks gained, with Hindalco Industries Ltd ending 1.2 percent higher and Tata Steel Ltd gaining 0.53 percent on hopes for revival in Chinese demand.

However, investors also booked profits in other blue chips, with Reliance Industries Ltd falling 0.1 percent after gaining 3.5 percent in the previous three sessions.

Meanwhile, Bharti Airtel ended 0.96 percent lower. The stock fell for the eighth straight session after its earnings fell short of expectations of some investors.

Housing Development and Finance Corp Ltd fell 0.3 percent, falling for the fourth straight session after its earnings disappointed some investors. The stock had declined 6.4 percent in the last three sessions.

(Editing by Anand Basu)