The Indian market extended its 2-day winning streak on Thursday, but concerns that higher oil prices will spur inflation limited the upside. Brent crude prices were last trading up about a percent near $125 a barrel, as a weaker U.S. dollar and data showing an unexpected sharp decline in crude inventories last week spurred buying interest.
Meanwhile, domestic data released today showed that food inflation for the week ended April 9 edged up to 8.74 percent after three successive weeks of decline, drawing attention to the need for further interest rate hikes by the Reserve Bank of India at the May 3 policy meet.
TCS announced good results, but the stock fell 2.23 percent on profit taking as there was little surprise on the upside. The country's largest software exporter said its fourth-quarter net profit rose 10.7 percent to Rs.2,623 crore from Rs.2,369.8 crore in the previous quarter, in line with estimates. Rival Wipro ended down 0.15 percent, while Infosys, which saw one of its top executive resigning recently, closed up 0.13 percent.
Profit taking before the extended weekend and caution ahead of energy giant Reliance Industries' Q4 results after the market close also kept investors guarded to a certain extent. After moving in a range of Rs 1,029-1,044, Reliance shares closed 1.39 percent higher at Rs.1,040.
The 30-share BSE Sensex, meanwhile, moved in a range of 19,696-19,530 before closing up 131 points or 0.67 percent at 19,602, with 21 of its components advancing. The broader Nifty rose by 33 points or 0.56 percent to 5,885, but the BSE mid-cap and small-cap indexes ended little changed with a positive bias.
Metal stocks outperformed as metal prices rose on the LME overnight. Hindustan Zinc climbed 3.12 percent after reporting a 43 percent rise in fourth-quarter net profit. Jindal Steel, Sterlite and Hindalco rose by 2-3 percent. Tata Steel edged up 0.60 percent after it agreed to sell 51 percent stake in Tata Refractories to Japan's Krosaki Harima.
Oil/gas, realty, banking, auto and FMCG stocks witnessed stock-specific buying, while capital goods, and power stocks closed subdued.
In the auto pack, Hero Honda Motors rose 2.41 percent after drifting lower in the past two sessions. Maruti Suzuki, which is considering to set up a new plant in Manesar, closed up 3.22 percent. Tata Motors lost 0.60 percent amid reports that it is finalizing a production site for its small car Nano at an overseas location.
Among banking stocks, State Bank of India rose 2.34 percent after it discontinued its teaser home loan schemes from May 1. Rival ICICI Bank edged up half a percent and HDFC Bank added 1.36 percent. Mortgage lender HDFC closed up 2.57 percent.
In the aviation sector, Kingfisher Airlines soared 4.22 percent, a day after it entered into an alliance with Royal Caribbean International to offer customers bundled vacation packages and additional benefits for airline's frequent fliers. Jet Airways eased 0.94 percent and and SpiceJet fell 3.17 percent despite data showing a 21 percent rise in air traffic in the Jan-Mar quarter.
Shares of scam-hit companies such as Reliance Communication, DB Realty and Unitech rose by 1-3 percent on short covering, a day after a special court in New Delhi rejected bail plea for five top corporate executives accused by the CBI in the 2G spectrum scam.
Reliance Infrastructure gained 1.61 percent on the news related to share buyback. Elecon Energy rose 2.38 percent on winning a Rs.30-crore order. Infotech Enterprises shed 1.28 percent on posting tepid Q4 earnings.
Elsewhere, most Asian stocks rose for a second consecutive session on Friday and European stocks extended gains for a third day in a row on expectations that the global economy is recovering fast from the worst financial crisis in decades.
The U.S. index futures pointed to a higher open for Wall Street later in the global day, adding to big gains in the previous session, as strong quarterly earnings reports from technology sector giants such as IBM, Intel, Yahoo and Apple boosted risk appetite and confidence in the economic recovery.
With the dollar weakening, crude oil prices surged to the highest level in two weeks, base metal prices advanced and gold held firm above the $1500 an ounce level.
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