Indian stock market started off today's session with strong gains. But the markets could not hold onto the gains for too long, and the Sensex was trading at the breakeven mark by mid-session. However, marginal gains were seen during the closing hours, with the BSE-Sensex closing higher by 0.2%, with the NSE-Nifty closed higher by 0.3%. The BSE Midcap and BSE Small cap indices closed higher by 0.6% and 0.4% respectively.
Most Asian indices closed the day in the green whereas Europe is also trading in the positive zone currently. The rupee was trading at near about Rs 44.74 per dollar levels at the time of writing.
India's inflation rate rose by 9.06% year-on-year (YoY) in May. This came in higher than the 8.66% rise in April 2011. This puts pressure on the central bank to raise interest rates once again in its monetary policy review this week. What is worrying is that while food price inflation rose by 8% in May compared to 7.6% in April, non-food manufactured inflation (India considers this 'core inflation') - rose from 6.3% to 7.2%. The RBI's final decision has to be carefully thought out, as higher interest rates are taking a toll on growth. The economy expanded by 7.8% from January to March, which was its slowest pace over the past five quarters.
According to latest information from TRAI (Telecom Regulatory Authority of India), the subscriber base of mobile users in India increased to 826.9 m at the end of April from 811.6 m in March. This was a growth of 1.9% YoY. With this increase, the current teledensity (telephones per 100 people) in India reached 72.1% from under 4% in March 2001. However, the number of active mobile subscribers, during the month amounted to only 583.2 m users.
Reliance Communications led the growth in subscriber additions by adding 2.9 m subscribers, followed by Idea Cellular with 2.5 m new users and Bharti Airtel (2.4 m new users). At the end of April, more than 8.5 m requests were received for mobile number portability (MNP) , from across India. MNP allows a user to switch telecom operators while keeping their old phone number. Thus, some of the subscriber additions could have come on account of MNP and not organic growth.