Sensex shrugs off high inflation no, up 43 pts on global cues

The Bombay Stock Exchange's 30-share index, Sensex, which had lost 228 points in the last four sessions, opened firm and recovered by 42.663 points. Broad-based National Stock Exchange index Nifty rose by 17.70 points to 5,500.50.

Brokers said the market was moving on positive global cues, shrugging of year-on-year inflation data for the month of May, which at 9.06 per cent is less than 10.48 per cent inflation recorded in May, 2010. However, it has broken away from the downward trend of the last few months this calender year. Inflation in April this year was recorded at 8.66 per cent.

Market analysts said investors bought fundamentally sound stocks across the board to benefit from the existing lower level prices. A firming trend iin Asian and higher opening in Europe fuelled the uptrend. The MSCI Asia Pacific Index climbed 1.1 per cent after a Chinese industrial production report raised optimism that the economy may grow amid government measures to curb inflation.

On BSE, the capital goods sector index gained the most, rising by 1.03 per cent to 13,493.67 as infrastructure major Larsen and Toubro climbed to a five-month high.

Banking sector index gained 0.83 per cent as ICICI Bank, the second-biggest private lender rose by Rs 15.85 to Rs 1,055.20 and SBI by Rs 13.85 to Rs 2,233.95.