Markets end tad higher ahead of the November IIP

Markets closed marginally higher supported by IT shares after street gave a thumbs up to Infosys's Q3 FY14 results and upbeat December trade deficit figures released today.

Key benchmark indices pared its early gains near the end of today's trading session pulled down by banking shares which witnessed panick selling after IndusInd bank reported a rise in its net performing assets (NPAs) in the third quarter ended December 31, 2013.

Also, investors turned cautious and booked profits at higher levels ahead of November index of industrial production data slated to be released later in the day.

The 30-share Bombay Stock Exchange Sensex closed 45.12 points higher at 20,758.49 and the 50-unit Nifty of the National Stock Exchange was quoting at 6,171.45, up 3.10 points.

Market surged in early trades after data showed that trade deficit for December eased significantly year-on-year. India's exports grew 3.49% in December to $26.3 billion, while imports dipped 15.25%. Imports last month were $36.4 billion.

IT shares led by Infosys came in focus after Infosys raised its revenue guidance for FY14 in its Q3 FY14 results, which were slighty better better than street expectations.

Shares of information technology (IT) companies closed 2.8% higher at Rs 3548.90-a-piece after the IT major reported a better-than-expected October-December (Q3) quarter earnings.

Infosys, ITC, (Reliance Industries Ltd) RIL, Tata Consultancy Services and ONGC were the top Sensex gainers at this hour.

Infosys, the largest gainer among IT pack has rallied over 3% at Rs 3,567 after reporting a 19.4% quarter-on-quarter growth in consolidated net profit at Rs 2,875 crore for the quarter ended December 31 2013 (Q3). Analysts on an average had expected net profit of Rs 2,681 crore for the quarter.

The consolidated net revenues came in at Rs 13,026 crore, up 0.5% sequentially, the country’s second-largest software services provider said in a statement. Consolidated dollar revenue came in at $2,100 million.

"Infosys’ revenue was in line but operating profit margin was a positive surprise – and an early indicator of the fruition of management’s efforts towards transforming the company to a ‘desirable Infosys’. INFO’s guidance has been on the conservative side in the past few quarters, and keeping that in mind, 12% USD revenue growth for FY14 at the higher end will drive some upgrade in our revenues for the next quarter. Secondly, 25-26% EBIT margin expectation in the medium term is also more reassuring from OPM recovery perspective. The results will likely drive marginal upgrades in earnings
," says Ashish Chopra, IT Analyst, Motilal Oswal Securities Ltd.

While, Daljeet Singh Kohli,Head of Research of IndiaNivesh Securities said "In our view, the gap between TCS v/s Infosys should narrow down going-head once it starts delivering consistent and in-line industry performance. At CMP of Rs.3,530, the stock is trading at 19.6x FY14E and 17.0x FY15E EPS estimate. We revise our target price upward to Rs.3,952 (19x FY15E) and continue to maintain  BUY on stock (Previous TP Rs. 3,630)."

Infosys Chairman, N R Narayana Murthy, said he was not sorry to see as many as eight top level executives quit the company in a matter of a few months.

In currency market, the rupee hit a one-week high of 61.94, its highest since January 2. Currently, the pair is trading at 61.93 versus its close of 62.07/08 on Thursday, tracking broad losses in the dollar versus other majors.

Foreign institutional investors (FIIs) sold shares worth a net Rs 3.74 crore on Thursday as per provisional data from the stock exchanges.

On the global front, Asian share markets stayed soggy on Friday after Chinese trade data proved to be a mixed bag, leaving investors with little incentive to take positions ahead of the US jobs report.

The Hang Seng gained 0.26% and the Nikkei 225 rose 0.20%. The Shanghai Composite lost 0.71%.

While China's exports grew a little less than expected at 4.3% in December, from a year earlier, imports easily outpaced forecasts with an increase of 8.3%.

Asian share markets stayed soggy on Friday after Chinese trade data proved to be a mixed bag, leaving investors with little incentive to take positions ahead of the US jobs report.

While China's exports grew a little less than expected at 4.3% in December, from a year earlier, imports easily outpaced forecasts with an increase of 8.3%.

Back home, on the sectoral front, BSE IT and TECk were up followed by Oil & Gas and FMCG indices which are up between 1.4-1.6%, Capital Goods, Realty and Healthcare are the other gainers. However, BSE Metal, power and auto indices are currently losing at the BSE.

Shares of information technology (IT) companies are trading higher by up to 2.6% at Rs 3,543.10-a-piece after the IT major reported a better-than-expected October-December (Q3) quarter earnings.

Infosys, ITC, RIL (Reliance Industries Ltd) , Tata Consultancy Services (TCS) and ONGC are the top Sensex gainers at this hour.

On the losing side, M&M, Coal India, Hindalco, Bajaj Auto and ICICI Bank have declined between 1-1.5%.

Shares of gold financing firms - Manappuram Finance and Muthoot Finance are trading higher by over 7%, extending their previous day’s 20% rally after the Reserve Bank of India (RBI) has revised upwards loan-to-value (LTV) norm for non-banking finance companies (NBFC) engaged in gold loans from 60% to 75%.

The broader markets are trading positive- BSE Midcap and Smallcap indices are up between -0.17 - 0.2%.

The market breadth in BSE remains marginally negative with 1142 shares advancing and 1191 shares declining.