BSE Sensex welcomes inflation fall, ends 35 points up

Erasing initial losses, the BSE Sensex on Monday ended higher by 35 points as investor sentiment was boosted by easing inflation.

The 30-share Bombay Stock Exchange benchmark declined to 16,037.60 in the opening trade but recovered to close higher by 34.74 points at 16,189.36. Broader National Stock Exchange Nifty edged up 7.90 points to 4,873.90 points.

Brokers said headline inflation falling to a two-year low of 7.47 per cent in December strengthened the hope that the Reserve Bank of India will cut lending rates in near future.

Markets, however, remained under pressure following a weak trend in the Asian region and lower opening in Europe after Standard and Poor's stripped France of its top credit rating and cut rating of eight other euro-zone nations.

The uptrend was mostly supported by stocks in capital goods, IT, teck and auto sectors. Capital goods sector gained the most at 2.07 per cent by IT at 1.80 per cent.

Infosys was up by 1.88 per cent, TCS by 1.91 per cent to and Wipro 1.57 per cent. Market leader Reliance Industries, however, fell by 2.55 per cent.

Of the 30 Sensex stocks,15 gained while other 15 closed with losses.

- With inputs from PTI