Indian shares rose modestly in volatile trading on Tuesday, with weak global cues on skepticism over the outcome of the upcoming European summit capping gains to some extent. Also, the rupee traded flat below the 57-mark against the U.S. dollar and Nomura cut its GDP forecast for India to 5.8 percent from 6.7 percent for the fiscal year ending March 2013, resulting in lackluster trade.
The benchmark BSE Sensex moved in the range of 16,816-16,947 before ending up 24 points or 0.14 percent at 16,907, with 20 of its components advancing. The broader Nifty index rose by 6 points or 0.12 percent to 5,121.
Gail India, Tata Power, ONGC, Mahindra & Mahindra, Sun Pharma and Hero MotoCorp led the gainers in the Sensex pack, with gains 1-3 percent, while FMCG player Hindustan Unilever lost 2 percent, copper producer Sterlite fell 1.2 percent, diversified business conglomerate ITC declined 1.1 pecent and steel maker Tata Steel shed a percent.
Energy giant Reliance Industries added a percent despite BNP Paribas reducing its weight on the stock. BHEL rose 0.8 percent on winning a Rs 950-crore contract for supplying equipment for a 1020-MW hydel project in Bhutan.
Reliance Power rose 2 percent on saying that it has synchronized the first 300 MW unit at its Butibori thermal power project near Nagpur in Maharashtra. Shares of Manappuram Finance soared 11.2 percent after private equity firm Baring India raised its stake in the company by 0.95 percent to 5.94 percent.
Bank shares turned in a mixed performance after the Reserve Bank of India yesterday hiked the limit of overseas investments in government bonds. SBI edged up 0.1 percent and HDFC Bank gained 1.3 percent, but ICICI Bank eased 0.2 percent.
SBI chairman Pratip Choudhary termed RBI's steps announced yesterday as short-term measures and stressed the need for enhancing equity and foreign investment in the country for raising exports and boosting the country's long-term growth.
IT bellwether Infosys lost over a percent, weighed down by signs of slower U.S. growth and concerns over Europe's debt crisis. Industry body Nasscom today said it would wait for another two quarters to revise revenue guidance for the IT industry this year in view of an uncertain global economic environment.
Maruti Suzuki India eased 0.2 percent amid reports that its new 800cc fuel-efficient car will hit the market later this year. Kingfisher Airlines fell 1.5 percent after reports emerged that 60-80 engineers have quit the beleaguered airline during the past 4-5 months due to non-payment of salaries. Essar Oil tumbled 3 percent after the Gujarat High Court rejected its plea for relief in repayment of over Rs 8000 crore sales tax deferment liability.
Elsewhere, stocks ended mostly lower across Asia after German Chancellor Angela Merkel indicated opposition to euro-area debt sharing before a crucial European summit later this week.
Risk aversion increased after Moody's Investors Services downgraded its long-term ratings on 28 Spanish banks, reflecting the reduced creditworthiness of the Spanish sovereign and the expectation that the banks' exposures to commercial real estate would likely cause higher losses. The announcement came on the same day that Spain formally requested European Union aid to help recapitalize its debt-laden banks.
European stocks were marginally higher in volatile trading despite debt sales revealing higher borrowing costs for the Spanish and Italian governments.
by RTT Staff Writer
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