The BSE Sensex seesawed in a narrow range on Tuesday as investors turned wary of building positions amid worries about weaker corporate earnings and high inflation hurting growth prospects in Asia's third-largest economy.
Trading remained mostly stock-specific with gains for drugmaker Cipla and leading vehicles maker Tata Motors, while Tata Power and Mahindra and Mahindra slipped after weak results.
There has been some initial buying and if this continues, we might see short covering later in the session. I expect the market to end on a positive note if there is no negative news today, said Neeraj Dewan, director at Quantum Securities.
At 11 a.m. (0530 GMT), the main 30-share BSE stock index was trading 0.1 percent higher at 17,133.71 points, after falling initially. Fourteen of its components were down.
Investors were cautious after the benchmark, one of the world's worst performers this year, fell to its lowest close in three weeks in the previous session. Weak Asian markets, trading down due to lingering doubts about Italy and Greece pushing through painful reforms to resolve their debt crises, added to the uncertainty.
Tata Motors rebounded 2.1 percent on short covering after initially sliding more than 2 percent following a 16 percent drop in quarterly profit announced late on Monday. The stock had fallen nearly 10 percent in November before the results.
Mahindra & Mahindra, however, fell for a second day, losing 0.6 percent after the leading utility vehicle maker reported lower-than-expected quarterly earnings and said the economic outlook for the year was cautious. Largest private-sector utility Tata Power dropped 5.5 percent to 95.65 rupees after swung to a quarterly loss due to foreign exchange losses and higher provisions.
Cipla rose 6 percent to 305.10 rupees after the drugmaker beat expectations with a 17.5 percent rise in quarterly profit, helped by lower input costs and higher utilisation of a new unit that enjoys higher tax breaks. Beaten-down Kingfisher Airlines was up 1 percent, after falling as much as 4.2 percent in early trade as its quarterly net loss doubled from a year earlier.
The 50-share NSE index was trading down 0.12 percent at 5,142.15 points. In the broader market, declines outnumbered gainers in the ratio of 2.9:1, with about 190 million shares changing hands. Among Asian markets, the MSCI's measure of markets other than Japan was down 0.9 percent, while Japan's Nikkei also fell a similar proportion.
STOCKS ON THE MOVE
* Real estate firm Sobha Developers Ltd fell 3 percent to 220 rupees after its September quarter profit fell 31 percent.
* Power equipment maker BGR Energy Systems Ltd fell 3.5 percent to 286 rupees after the company's second quarter profit dropped 34 percent. Brokerage Citigroup also downgraded the stock to 'sell' from 'neutral' and cut its target price by a third citing balance-sheet deterioration.
TOP THREE BY VOLUME
* Shree Renuka Sugars on 19.4 million shares
* Tata Motors on 12 million shares
* Kingfisher Airlines on 5.6 million shares