The key benchmark indices were off the day's high as profit taking emerged at higher level after recent strong post-Budget gains. The BSE 30-share Sensex was up 76.77 points or 0.45% to 17,129.31, off 54.20 points from the day's high and up 101.39 points from the day's low. Most Asian stocks rose, reversing initial losses.

Though still positive, the market breadth was not as strong as in early trade. Cement stocks gained on recent reports of prices likely to rise by Rs 5-25 per 50-kg bag. Auto stocks also edged higher on fresh buying. Telecom pivotals saw divergent trend. Index heavyweight Reliance Industries advanced over 2.5%, moving past the Rs 1000 mark on reports the firm is close to striking hydrocarbon at its Palar deepwater block in the Cauvery basin.

The follow-on public offer (FPO) of iron ore miner NMDC was subscribed 0.05 times by 12: 00 IST on the first day of the issue today, NSE data showed. The government is divesting 8.38% stake in NMDC through the FPO as a part of its aggressive divestment drive to raise funds in a bid to bring fiscal deficit down. The company's FPO will close on Friday, 12 March 2010. The price band has been fixed between Rs 300 and 350.

Asian stocks fluctuated as shipping lines and oil companies declined, while Australia's largest telephone company rose on speculation it will avoid a breakup.The key benchmark indices in South Korea, Japan, Hong Kong, Indonesia, Taiwan and Singapore were up by between 0.03% to 0.53%. However, China's Shanghai Composite declined 0.6%.

China's trade surplus narrowed further to $7.6 billion in February from $14.2 billion in January on surging imports even as the nation's exports continued to rise rapidly, according to reports. February exports jumped 45.7% from the same month of 2009, while imports expanded by 44.7%.

Japan's machinery orders slipped in January 2010 after the biggest jump since 2000, indicating a subdued appetite among the nation's companies to ramp up capital spending even as manufacturing passed its worst. Orders, a signal of business investment in three to six months, dropped 3.7% from December, when they climbed 20.1%, the Cabinet Office said today.

A separate report showed Japan remains plagued by deflation. Producer prices fell 1.5% in February 2010 from a year earlier, the 14th consecutive drop, the central bank said.

US equities ended slightly higher on Tuesday as falling commodity prices pressured materials stocks, offsetting gains in the telecom and industrial sectors. The Dow Jones Industrial Average gained 11.86 points, or 0.11%, to 10,564.38. The Standard & Poor's 500 Index edged up 1.95 points, or 0.17%, to 1,140.45 and the Nasdaq Composite index rose 8.47 points, or 0.36%, to 2,340.68.

Trading in US index futures showed that the Dow could fall 3 points at the opening bell on Wednesday, 10 March 2010.

Investors will monitor US retail sales for February 2010 and Reuters/University Of Michigan Consumer Sentiment Survey for March 2010, both due on Friday, 12 March 2010, for any hints on the health of the global economy.

Closer home, the government is likely to maintain the distinction between short term and long-term capital gains to encourage long-term savings, as it deliberates the draft direct taxes code (DTC). The finance minister said in his Budget speech that the new direct taxes law could be rolled out from 1 April 2011.

The DTC has proposed to tax capital assets irrespective of the period of holding. The entire capital gains of the assessee is proposed to be added to his income and taxed at the marginal rate.

Currently, any stock market asset held for more 12 months is considered long-term capital assets but for all other assets have to be held for more than 36 months to be considered a long-term asset. Moreover, there is zero capital gains tax on shares held for the long-term while others assets are levied a long-term capital gains tax of 10%.

Meanwhile, Russian Prime Minister Vladimir Putin heads to India Thursday for a visit aimed at tightening the close arms and energy partnerships that Moscow and New Delhi have enjoyed since the Soviet era.

The highlight of the two-day visit is expected to be the signing of several military agreements, including a deal on a Soviet-era aircraft carrier whose troubled history has raised fears over the future strength of relations. Russia supplies 70% of India's military hardware but New Delhi has in recent years also looked towards other military suppliers including Israel and the United States.

Meanwhile, India and China on Tuesday decided to formally back the Copenhagen Accord worked out at the climate summit in December last year. While neither India nor China have said that they would 'associate' with the accord, both countries have agreed to have their names listed in the preamble. The move would come as boost to the accord. With this the four BASIC countries - Brazil, South Africa, Indian and China - which were key players in formulating the accord have agreed to be listed in the chapeau.

On the political front, the Rajya Sabha on Tuesday took a historic and giant step by voting to amend the Constitution, providing one-third reservation of seats in Parliament and State Assemblies for women. The Bill has to be passed by the Lok Sabha and ratified by 50 per cent of the States before it comes into effect.

Going ahead, the key triggers for the stock market are structural reforms such as decontrol of petrol and diesel prices, targeting of food subsidies, and financial sector reforms such as increase in foreign direct investment in insurance sector.

The government will announce the industrial output data for the month of January 2010 on Friday, 12 March 2010. Industrial output grew 16.8% in December 2009.

Meanwhile, the fourth and the last installment of advance tax by India Inc due on 15 March 2010 will give a broad indication of fourth quarter earnings.

The government said on Friday it will seek parliamentary approval to spend an extra Rs 31780 crore for the fiscal year to end-March 2010, which it plans to fund through savings.

There is no risk that the government will borrow more than planned to fund supplementary spending, Revenue Secretary Sunil Mitra said on Friday. Of the additional spending, Rs 12000 crore would be spent on oil subsidy, Rs 8000 crore on fertiliser subsidy and Rs 2459 crore on food subsidy, among others.

Prime Minister Manmohan Singh said late last week that the economy would grow by at least 8% in the year through March 2011. Asia's third largest economy would expand 7.2-7.5% in 2009-10, he told parliament. Singh said prospects for the winter-sown crop are 'very encouraging'. He also said the government must pay good prices to farmers to ensure higher farm production. The prime minister said the government will take all practical measures to bring down food prices.

He said the government will continue commitment to pubic and private investment in agriculture. The prime minster said there is need to find ways and means to stabilise the sugar economy.

A good harvest is likely to bring down food inflation, which accelerated to nearly 18% in late February. The government, facing mounting criticism for rising food prices, is struggling to meet conflicting aims of controlling food inflation and trying to please farmers by paying them attractive prices.

Chief Economic Advisor Kaushik Basu on Tuesday, 9 March 2010, said inflation would ease by April 2010, with low fiscal deficit and a good rabi (winter) crop improving food supplies. In a couple of months, the slightly lower fiscal deficit will begin to counter inflation, he added. Speaking on the sidelines of a conference in New Delhi Basu said inflation is likely to average 4% in the current financial year.

The newly elected president of industry body FICCI Rajan Bharti Mittal said on Monday there's no room for hardening of interest rates and the Reserve Bank of India should maintain status quo on the rates to allow the industry to make fresh investments. He added that fresh investment announcement have begun across sectors and further increase in interest rates will only hamper economic growth.

Food prices will be keenly watched in coming weeks for the second and third round impacts of the recent fuel price rise. Market men see a 25 basis points hike in the repo and reverse repo rates each by the RBI at the April 2010 policy review.

Prime Minister Manmohan Singh has ruled out rolling back a price hike in fuel prices despite pressure from his main allies, saying populist policies would hurt the economy in the long-term. Petrol prices rose about 6% and diesel prices by 7.75% after the government increased factory-gate taxes and import duties on the fuels as part of last week's 2010-11 union budget 2010-11, which stressed fiscal prudence to cut a wide deficit

Reserve Bank of India (RBI) Governor D Subbarao on Monday, 8 March 2010, said inflation should moderate in the coming months. He said the central bank will ensure that interest rate levels do not have a negative impact on the competitiveness of the economy. Should India need to manage inflationary expectations, the central bank could turn to its traditional mix of policy tools including use of both liquidity and cash reserve requirements, he said.

Subbarao said the government's plans to reduce the fiscal deficit this year and in 2011 would help to manage inflationary expectations and facilitate demand for private credit. The government's borrowing program is likely to proceed smoothly over the next financial year, he said. The government has set its gross market borrowing target for 2010/11 at a record Rs 4.57 lakh crore, up by 1.3% percent from the previous year, a move that has pushed bond prices lower as investors have anticipated a flood of fresh debt supply.

The heavy borrowing plans of the government, needed to fund the estimated 5.5% fiscal deficit for the year, has had analysts concerned it would make funding costlier and scarcer for industry. Planning Commission deputy chairman Montek Singh Ahluwalia on Tuesday said the government will raise more than half of its borrowing for the next year by September 2010, allowing more space for private borrowing as the economic growth picks up steam. Ahluwalia also said the government would have to raise state-set retail fuel prices if crude oil prices continued to rise.

Finance minister Pranab Mukherjee's budgetary proposals last week offered a progressive cut in fiscal deficit over the next three fiscal years, changed personal tax rates lifting disposable incomes in the hand of individuals and reduced surcharge on corporate tax for domestic companies to 7.5% from 10%.

The Finance Minister in his budget speech on Friday, 26 February 2010 said the government aims to introduce the Goods and Services Tax (GST) and implement the direct tax code from 1 April 2011.

The fiscal deficit is pegged at 5.5% of GDP for 2010-2011, lower than an estimated 6.8% for the current fiscal year. The finance minister said the government also aimed to reduce the deficit further to 4.8% of GDP in the year starting 1 April 2011, and to 4.1% in the year from 1 April 2012. He said there is a need to review stimulus and move towards fiscal consolidation and review public spending.

A thrust on the infrastructure sector augurs well from a long-term growth perspective. The Finance Minister has provided Rs 1.73 lakh crore for infrastructure development in 2010-2011, which accounts for over 46% of the total plan expenditure for the year.

The stock market has applauded the Union Budget 2010-2011 due to its thrust on infrastructure development, government's pledge to reduce fiscal deficit over the next three years, a smaller-than-expected 2% hike in excise duties, and reduction in taxes for individuals which will boost disposable income. The Finance Minister has assumed a modest GDP of about 8% and inflation of about 4.5% for 2010-2011.

Finance Minister Pranab Mukherjee on Wednesday, 3 March 2010 said India's economic recovery is still being driven by public spending and is not yet broad-based, further clouding the debate on the timing of rate hikes by the central bank.

Foreign funds bought shares worth Rs 2173.09 crore and domestic funds sold shares worth Rs 171.66 crore on Tuesday, 9 March 2010, as per provisional data.

At 12:21 IST, the BSE 30-share Sensex was up 76.77 points or 0.45% to 17,129.31. The index rose 130.97 points at the day's high of 17,183.51 in morning trade. The Sensex lost 24.62 points at the day's low of 17,027.92 in early trade.

The S&P CNX Nifty was up 18.75 points or 0.37% to 5120.05

The market breadth, indicating the overall health of the market was positive. On BSE, 1399 shares advanced as compared with 1288 that declined. A total of 97 shares remained unchanged. The breadth was much stronger in opening trade.

Among the 30-member Sensex pack, 21 advanced while the rest slipped. NTPC (down 0.79%), Sun Pharmaceuticals (down 0.81%), and Larsen & Toubro (down 0.89%), edged lower from the Sensex pack.

Index heavyweight Reliance Industries (RIL) advanced 2.19% to Rs 1011.85, moving past the Rs 1000 mark. It was the top gainer from the Sensex pack. As per reports, RIL is close to striking hydrocarbon at its Palar deepwater block in the Cauvery basin. In the Palar block, RIL is said to be testing a well. The hydrocarbon success would be known only after testing is completed.

Meanwhile, Power Secretary HS Brahma has reportedly urged his counterpart in the Ministry of Petroleum and Natural Gas to release gas to NTPC at the international competitive bidding (ICB) rate of $2.34 per million metric British thermal units (mmBtu), this time on the legal backbone of an affidavit filed in Supreme Court in December. In a letter dated 3 March 2010, Brahma insisted that Secretary, Petroleum and Natural Gas, S Sundareshan allocate 12 million metric standard cubic meter per day (mmscmd) of gas to NTPC immediately, without waiting for further resolution of the RIL-NTPC proceedings in the Bombay High Court.

Oil & Natural Gas Corporation (ONGC) was down 0.05% and Indian Oil Corporation (IOC) declined 0.21% after Oil Secretary S. Sundareshan said on Wednesday that the government has no immediate plans to sell stake in these two state-run firms.

Telecom pivotals saw divergent trend. India's largest cellular services provider by sales Bharti Airtel lost 0.98% to Rs 288.50 and was the top loser from the Sensex pack. As per reports, Bharti Airtel has completed about 60% of its due-diligence of Zain's African assets.

Zain, Kuwait's biggest phone company, and Bharti Airtel said on 15 February 2010 that they had entered into exclusive talks under which the Bharti would buy most of Zain's African assets for $10.7 billion. The exclusive talks will continue until 25 March 2010.

India's second largest cellular services provider by sales Reliance Communications gained 0.43%. The company has announced a new mobile application named Socially. With this application, a user can follow his friends' activities on social networks such as Facebook, Twitter and LinkedIn through a single platform.

Cement stocks gained on recent reports that prices are likely to rise by Rs 5-25 per 50-kg bag. The impeding price hike comes after the finance minister increased the excise duty on cement in the budget to 10% from the earlier 8%, imposed a cess of Rs 50 per tonne on domestic and imported coal and hiked fuel prices, pushing up freight rates for cement companies.

ACC (up 1.51%), Ambuja Cements (up 0.70%), UltraTech Cement (up 1%), India Cements (up 1.49%), Dalmia Cement (up 3.92%), and Binani Cement (up 3.91%), advanced.

Auto stocks gained on fresh buying. India's largest truck maker by sales Tata Motors gained 2.10%. The stock made a comeback on bargain hunting after sliding 3.24% on Tuesday following Germany's Daimler AG offloading its entire stake in Tata Motors in bulk deals. Daimler AG sold its entire about 2.56 crore shares at an average price of Rs 751.67 in Tata Motors through various bulk deals on Tuesday, 9 March 2010.

Tata Sons, the holding entity for Tata Group firms, and Citigroup have acquired a total of 86.5 lakh shares of Tata Motors from Germany's Daimler AG. Tata Sons bought 40 lakh Tata Motors shares at Rs 750 each, while Citi bought 46.5 lakh shares at Rs 752.41 each

India's largest bike maker by sales Hero Honda Motors rose 1.50% to Rs 1902.70. The stock had struck an all-time high of Rs 1,921 on 8 March 2010.

India's largest car maker by sales Maruti Suzuki India rose 0.54%, extending recent gains on reports that Suzuki Motor Corporation has raised its stake in Maruti Suzuki to 55%, triggering speculation about the Japanese firm's intentions for its Indian subsidiary. Suzuki raised its stake in Maruti by 0.8% through secondary market purchases recently and is set to increase its stake further, reports indicated.

India's largest tractor maker by sales Mahindra & Mahindra (M&M) advanced 0.80%, reversing early losses.

Marg rose 0.35% after the company signed a pact with Virginia Tech University of United States for construction of a university campus at Chennai named Virginia Tech MARG Swarnabhoomi, India. The company made this announcement before trading hours today, 10 March 2010.

Jindal Steel & Power fell 2.14% on reports the firm is about to lose mining rights at the world's largest iron ore site, Al Mutun Bolivia.

Anu's Laboratories rose 1.10% ahead of a board meeting later today, 10 March 2010, to consider the amalgamation of Nitya Laboratories with the company.

GEI Industrial Systems rose 3.62% after the company bagged three orders worth Rs 54.46 crores in the Oil & gas sector. The company made the announcement of bagging orders during market hours today, 10 March 2010.