Sensex ends higher a day ahead of crucial GDP data

By Abhishek Vishnoi

MUMBAI (Reuters) - The BSE Sensex rose on Thursday in a volatile session marked by the expiry of May derivatives, buoyed by gains in auto stocks such as Tata Motors and M&M, which posted market beating quarterly earnings.

Analysts said better-than-expected earnings by Sun Pharmaceutical Industries Ltd , Tata Motors Ltd and Mahindra and Mahindra Ltd (M&M) had tilted views about Jan-March earnings season as being "slightly better" than "mixed" earlier.

Investors are now awaiting January-March economic growth data due on Friday. Indian economic growth probably nudged up in the three months to March from a near four-year low the previous quarter, a Reuters poll showed on Tuesday, suggesting a gradual turnaround from a prolonged slowdown.

 

Dealers hope that weaker growth may push the central bank to cut interest rates again, when it meets next month on June 17.

"With inflation falling, GDP is also expected to give cues for continuation of rate reversal cycle," said Vijay Kedia, director at private wealth management firm Kedia Securities.

June would also be a positive month as apart from Foreign Institutional Investors, markets are underowned by almost all other class of investors, added Kedia.

The BSE Sensex rose 0.34 percent, or 67.76 points, to end at 20,215.40. The index ended up in four out of last five sessions.

The broader Nifty rose 0.32 percent, or 19.75 points, to end at 6,124.05, closing above the psychologically important 6,100 level.

Shares in Tata Motors gained 4.4 percent after its quarterly earnings beat estimates, helped by better-than-expected margins at unit Jaguar Land Rover Ltd.

Mahindra and Mahindra, India's biggest utility vehicle manufacturer, rose 4.5 percent after it posted a forecast beating 1.7 percent rise in net profit for the three months ended March, helped by higher sales.

Among other auto stocks, Bajaj Auto Ltd rose 0.7 percent while Maruti Suzuki India Ltd ended 0.2 percent higher.

Sun Pharmaceutical Industries Ltd rose 0.8 percent, marking its second day of gains after hitting an all-time high of 1,084.80 rupees earlier, as its net profit rose more than expected and its management guided for robust sales growth in FY14 on Tuesday.

However, among stocks that fell, Cipla Ltd declined 4.7 percent after it reported an 8.2 percent fall in quarterly net profit, lagging street estimates, as sales growth in its key domestic market slowed down.

State-run explorer Oil & Natural Gas Corp fell 0.3 percent after it reported a higher-than-expected 40 percent slump in quarterly profit, as higher taxes, write-offs for dry wells and additional depreciation offset rising sales.

(Editing by Anand Basu)