The Sensex was holding ground in early trade, as investors continued to draw comfort from the broad sentimental boost derived after a change of guard at the finance ministry.
The benchmark index- the Sensex had risen up to 0.5 percent earlier. The BSE Mid-cap index was up 0.6 percent, outdoing the Sensex, which was up just 0.2percent.
Maruti Suzuki, up 1.8 percent, was the top gainer, while banks were also up. State Bank of India was up 0.6 percent and ICICI Bank 0.3 percent. Among sectoral indices, the BSE metal index was up 1.31 percent. Sesa Goa, up 3 percent, was the top gainer among index constituents.
Interest rate sensitives are in the limelight after Chief Economic Advisor Kaushik Basu said inflation would soften from mid-October.
FMCG stocks were down, on fears deficient monsoon may affect the profitability of these companies. The BSE FMCG index was down 0.3 percent. The local market is also tracking the Asian markets that were boosted on hopes that the European Central Bank may announce stimulus measures.
Technical analyst Sudarshan Sukhani, s2analytics.com expects Nifty to break the narrow range of 5,270- 5,320 soon. “They cannot hold into this range. This 50 point range is going to break one way or the other, probably in a day or two or as soon as possible,” he said in an interview to CNBC-TV18.
Stock specific news:
Gujarat Pipavav was up 2.5% as the company launched qualified institutional placement (QIP) issue. It is planning to raise USD 36.39 million.
Eveready surged 4.5%. 3i Infotech was up nearly 2% as ICICI Bank acquired 8.9 crore shares (20.51%) of the company via conversion of preference shares and loan conversion to CDR scheme.
Berger Paints rose 2.5% as The Hindu Business Line reported that it is looking for acquisitions both in India and abroad.