State-run oil firms have increased petrol prices by Rs 5 per litre from May 15. Finance minister Pranab Mukherjee has said that next weeks EGoM meet would discuss issues relating to hike of diesel, LPG and kerosene prices.
Sandeep Bhatia of Kotak Institutional Equities tells CNBC-TV18 that the price increase is a welcome move. “There is a long way to go in correcting the retail fuel prices whether it is diesel, petrol or cooking fuels. We will have to see in the next one month what kind of action this government takes.”
April inflation numbers are expected today. A CNBC-TV18 poll sees April inflation still at an elevated level of 8.46% vs 8.98% (MoM).
Slowdown in growth and high inflation are still among key concerns among economists. Economist feel that if inflation crosses beyond 8.7% this time then forecast of inflation and economic growth has to be revised.
However, buying was seen in pharma stocks like Ranbaxy, Glenmark Pharma, Sun Pharma. The BSE healthcare index was up over 1%.
Glenmark Pharma was up 14% on the back of news that the company is in licensing deal with Sanofi and will receive upfront payment of USD 50 million. The USD 50 million includes USD 25 million contingents upon Sanofi's assessment. The deal is for commercialisation of GBR 500, reports CNBC-TV18.
At 10.41 hrs IST, the Sensex was down 117.83 points or 0.64% at 18413.45, and the Nifty was down 22.60 points or 0.41% at 5522.15.
The market breadth was negative, about 1036 shares advanced, 1216 shares declined, and 1389 shares were unchanged.
Niall Macleod, UBS said that, "We are positive on Asia ex-Japan for 2011. Earnings growth forecasts look achievable and valuations appear attractive. With liquidity remaining loose and the domestic credit cycle set to improve, we think Asia could be re-rated. We are Overweight financials and Shriram Transport is amongst the top 11 buy calls in Asia."
Top gainers on the Sensex were Bharti Airtel at Rs 373.60 was up 1.74%, Hero Honda at Rs 1,823 was up 1.53%, BHEL at Rs 2,055.60 was up 1.17%, HUL at Rs 308.80 was up 0.77% and TCS at Rs 1,128.50 was up 0.07%.
Top losers on the Sensex were M&M at Rs 675.65 was down 2.35%, Jaiprakash Asso at Rs 85.65 was down 2.17%, Reliance Infra at Rs 599 was down 1.96%, HDFC at Rs 635.35 was down 1.76% and Tata Motors at Rs 1,192.90 was down 1.49%.
Tech major Infosys was trading at Rs 2,853.50 down 0.92% from its previous close of Rs 2,880.05.
Cigarette major ITC was trading at Rs 187.10 down 1.27% from its previous close of Rs 189.50.
