MARKETS PARE GAINS

Key benchmark equity indices pared most of their early gains, and are in red. Similarly, broader markets which were trading in the positive territory have also pared some of their early gains; the BSE Mid cap and Small cap indices are trading with gains of 0.39% and 1.01%, respectively. On the global front, rest of the Asian markets are trading mixed as China hiked its reserve ratio by 50 basis points (bps); while US index futures are showing down-tick in screen trade. Back home, auto, oil & gas, consumer durables, banking and metal counters were witnessing maximum traction; while, information technology and realty segments were the only draggers in the local markets. Software bellwether Infosys Technologies is extending its Friday's loss and is trading down by one and half-a-percent after reporting disappointing results. The market breadth on the BSE was strong; the gainers thrashed the losers in a ratio of 1700:923 while 99 scrips remained unchanged.

The BSE Sensex slipped 200points  at 19,190.60. The index has touched a high of 19,649.22 and a low of 19,180 respectively.

The BSE Mid cap and Small cap indices rose 0.39% and 1.01% respectively. 

The top gainers on the BSE sectoral indices were Auto up 1.28%, Oil & Gas up 1.09%, Consumer Durables (CD) up 1.07%, Bankex up 0.36% and Metal up 0.29%.

On the flip side, Information Technology (IT) down 1.22%, TECk down 0.81% and Realty down 0.19% were the only losers in the BSE sectoral indices.

The top gainers on the Sensex were Hero Honda up 4.86%, Rel Infra up 2.22%, Sterlite Inds up 1.93%, HUL up 1.65% and RIL up 1.65%.

On the flip side, Infosys down 2.02%, TCS down 1.12%, Cipla down 0.84%, DLF down 0.63% and BHEL down 0.52% were the major losers on the index.

Economies like India and China, that are set to grow at a rapid pace, will also see high inflationary pressures which is a natural outcome of high growth trajectory and policy makers will have to manage the growth-inflation trade-off, said the International Monetary Fund (IMF) on Saturday.

Talking about the high inflation pressures in India and China, the IMF managing director, Dominique Strauss-Kahn, said it would be very surprising that an economy like the Chinese or Indian could rise at 8- 9% a year without ever facing the question of inflation. "It is absolutely normal. They have to manage it,' Kahn said on the sidelines of the Spring Meeting of the IMF and World Bank in Washington.

'At the same time, it comes at a moment when growth produces its results, namely that people have more purchasing power, of course, when you have more purchasing power, at the level, absolute level, which is not very high, all this is used for more consumption; so rightly it produces inflation,' he said while explaining the inter-relations of growth and inflation.

On moderation in growth when policy makers try to check inflation, Kahn said that it was normal again but the process of managing growth-inflation was a continuous one. He conceded that rising inflation has generated concerns for fast growing economies but added that steps were being taken by policy makers to check inflation, referring to the monetary tightening implemented by the Indian and Chinese central banks.

The IMF had said in a recent report that even though there was a very difficult trade-off in high growth and inflation, emerging economies needed to continue growing at a reasonable pace, while at the same time curbing inflation as much as possible, as for achieving the poverty alleviation targets, high growth was a must. The Indian government too has been saying that at least 8-9% growth every year was needed to reduce poverty at a rapid pace and ensure basic amenities across the country.

The S&P CNX Nifty slipped 70 points  at 5855.85.  The index has touched a high and a low of 5897.90 and 5750.30 respectively.

The top gainers of the Nifty were Hero Honda up 4.56%, HUL up 1.80%, Ambuja Cements up 1.59%, Reliance Infra up 1.44% and Sterlite Inds up 1.40%.

On the flip side, Infosys down 1.99%, TCS down 1.65%, IDFC down 1.27%, Cipla down 1.21% and DLF down 1.16% were the major losers on the index.

Other key Asian markets are trading mixed. Hang Seng gained 0.01%, KLSE Composite rose 0.53%, Nikkei 225 added 0.01%, Straits Times advanced 0.22% and Seoul Composite surged 0.04%; while Shanghai Composite dipped 0.17%, Jakarta Composite dropped 0.02%, and Taiwan Weighted was down by 0.04%.