makin97 NSETIPS @ RAKESH MAKIN: MARKET ENDED 14.06.2011 TUESDAY

WERE TODAY'S GAINERS

MARKET ENDED 14.06.2010 TUESDAY

SENSEX 18308.66 +42.63

NIFTY 5550.00 +17.70

NASDAQ 2677.23 +37.54

UPDATEDTIME 09.28 PM 14 JUNE 2011

Indian markets ended a range bound session on in the green even as the WPI May inflation surprised on the higher side at 9.06 per cent against 8.66 per cent in April. According to analysts, the Reserve Bank of India is likely to raise the interest rates by 25 basis points in it policy review meet as it is focusing on to rein inflation at the cost of growth.

Sticky trends in inflation, coupled with the RBI's recent stance of bringing down inflation at the cost of growth, prompt us to maintain our view of a further 75bps of tightening in 2011. This would take policy rates to 8% by end-2011, with a hike likely in the 16 June meeting this week.

However, as mentioned in our India Macro View, we re-iterate our view that given underlying consumption dynamics and the fact that 60% of the rise in inflation is commodity led and thus beyond the control of the RBI , the need of the hour is a pick-up in the investment cycle, productivity enhancements particularly in food processing, warehousing
National Stock Exchange's Nifty ended at 5500.50, up 17.70 points or 0.32 per cent. The broader index touched a high of 5520.15 and low of 5484.20 intraday.

Bombay Stock Exchange's Sensex was at 18308.66, up 42.63 points or 0.23 per cent. The 30-share index hit a high of 18380.19 and low of 18261.11 in trade today.

Hourly chart for the index suggests that short term bullish reversals could be round the corner, as long as yesterday's low at 5436 is not breached. A likely bullish H&S formation seems under way with neckline placed around the 5600 levels, the pattern would confirm once 5600 is broken out of.

Momentum signature though point at the likelihood of a reversal as the indicator KST has formed a positive divergence and has also given a bullish crossover on its signal line. Expect the index to trade with the positive bias for the next few sessions.

BSE Midcap Index was up 0.60 per cent and BSE Smallcap Index moved 0.37 per cent higher.

Amongst sectoral indices, BSE Capital Goods Index was up 1.03 per cent, BSE Power Index gained 0.96 per cent and BSE FMCG Index moved 0.86 per cent higher. BSE Oil&gas Index was down 0.77 per cent and BSE Auto Index slipped 0.19 per cent lower.

Reliance Infrastructure (2.35%), Bajaj Auto (2.26%), Jindal Steel (1.97%), ICICI Bank (1.53%) and ITC (1.52%) were amongst the top Sensex gainers.

Tata Motors (-2.84%), Hindalco (-2%), HDFC (-1.42%), Reliance Industries (-1.41%) and Cipla (-1.09%) were the major losers.

Shares of Housing Development Finance Corp were down on profit booking after Citigroup reduce its 11.4 per cent stake in the firm by 1.5 per cent to 9.9 per cent. Reducing the holding is part of Citigroup's mitigation efforts ahead of adoption of Basel III capital rules.

Market breadth was positive on the BSE with 1625 gainers against 1204 losers.