Expectation of a significant cool off in the consumer price index (inflation) for December to be announced today saw the Nifty and the Sensex gaining over 1.6 per cent at the closing session on Monday.

The 30-share BSE index Sensex was up 375.72 points or 1.81 per cent at 21,134.21 and the 50-share NSE index Nifty was up 101.30 points or 1.64 per cent at 6,272.75.

Except healthcare, all other BSE sectoral indices ended in the green. Among them, IT and TECk indices gained the most by 2.92 per cent and 2.4 per cent, respectively, followed by banking 2.04 per cent and capital goods 1.55 per cent. Only healthcare index was down 0.68 per cent.

TCS, Infosys, ICICI Bank, ONGC and RIL were the top five Sensex gainers, while the top five losers were Tata Power, Sun Pharma, HUL, Maruti and Hindalco.

A report from India Forex Advisors said: “India's stubbornly high inflation finally appears to be slowing down following a cooling in vegetable prices. Easing inflation will also make life easier for the Reserve Bank of India (RBI) that has an arduous task of pulling the economy out of a stagflation-like situation. Economic growth has been stuck below five pe rcent for the past four quarters but prices have risen at a fast pace.”

Banks led European stocks higher after regulators eased a debt-limit rule. Asian stocks were mixed as investors remained cautious over slower growth in US payrolls.

US jobs data has revived hopes that the Federal Reserve will delay the tapering of its stimulus programme at its meeting later this month.

(This article was published on January 13, 2014)
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