Food inflation numbers help market sentiments

The Indian markets continue to remain flat and positive, with both the bourses marginally up by 0.38%. Negative food inflation numbers lifted sentiments on the hope that the RBI may start infusing liquidity in the markets by cutting down its key policy rates. However, the weak closing of the Asian markets remained a dampener.

After witnessing a positive opening, most of the other Asian markets closed on a negative note today. This was amid concerns over the Euro zone debt crisis that tempered investor sentiment. The Hang Seng was marginally up by 0.16% after a holiday, while the Nikkei and Shanghai ended with losses of 0.84% and 1% respectively.

European markets opened on a flat note, on the back of a report that shows that the American service industry grew the fastest in 3 months.

Back home, CG, Auto and Bankex are leading among the sectoral indices, with gains of more than 1%. Others like Power, Pharma, Metals, IT and Teck remained positive, with marginal gains of nearly 0.5%. All the other indices were down between 0.22%-1%. Realty remained the top loser for the session, down by 1%.

JP Associates, Hero MotoCorp and Bajaj Auto are leading the 30-share Sensex with gains of more than 4.34%, 2.29% and 2.16% respectively. Among others, stocks like BHEL, Cipla, ICICI Bank, L&T, Sun Pharma and Tata Power are trading with gains between 1%-2%. On the other hand, DLF is leading on the losers tally, down by 3.26%.

The market breadth, which indicates the overall health of the market, is positive. On the BSE, 1556 shares rose, 933 shares fell and 101 shares remained unchanged.

We expect the markets to remain flat and positive for the rest of the day, and advise readers to play with caution.