Indian equity markets had a rather volatile trading session today. The indices began the day's proceedings on a strong note and subsequent trading hours saw them oscillate to either side of Monday's close with the indices eventually closing the day in the green. While the BSE-Sensex closed higher by 30 points, the NSE-Nifty closed higher by 14 points. Both the BSE Mid Cap and the BSE Small Cap closed flat. Maximum buying interest was seen in pharma and Power stocks.
As regards global markets, Asian indices closed in the green. European indices have opened in the red. The rupee was trading at Rs 54.74 to the dollar at the time of writing.
The wholesale price index (WPI) based inflation plunged to sub-5 level to stand at 4.89% in April against 5.96% in the previous month. This is the lowest level since last seen in 2009. In broad categories, inflation in food items declined to 6.08% in April from 8.73% in the previous month and to 8.84% from 10.18% in fuel and power. The only caveat is that these are provisional numbers and nowadays these figures are sharply revised. Provisional inflation numbers at 6.84% in February were revised to 7.28%. While the upward revision to February's WPI inflation is an issue, the revisions appear to be stalling, given that the changes are coming largely from volatile food items. Today's WPI inflation report provides room for the RBI to cut policy rates at its 17 June policy meeting. However, given that consumer price inflation is still on the higher side, one will have to see whether the central bank bites the bullet.
According to a leading financial daily, Bharat Heavy Electricals (BHEL) is planning to invest Rs 5 bn for setting up a new Power Equipment Fabrication Plant at Bhandara in Maharashtra. BHEL intends to start production in this factory in 24 months from the completion of land acquisition activity. It is hopeful that the turnover from this new plant will progressively rise to approximately Rs 10 bn. The factory will be supported by BHEL's manufacturing unit at Trichy. BHEL's other units at Bhopal, Haridwar, Ranipet and Hyderabad will also extend support through their fabrication works. The plant will provide direct employment to 700 people.