Brokers said, ''The market edged higher at the onset of the trading session ahead of Reserve Bank of India's monetary policy review scheduled at 12 noon. Rate sensitive banking and auto stocks edged higher while realty stocks were mixed. The market breadth was strong. Asian markets which opened before Indian market were mixed. Brokers further informed, ''RBI has noted that freely priced fuel items such as naphtha had increased substantially since February 2007 alongside rising global oil prices, while prices of petrol and diesel, which are government-controlled, had partially adjusted.
But, prices of kerosene and cooking gas had not been raised by the government for several years. RBI felt there were some demand-side pressures. Domestic iron and steel prices saw a sharp increase in line with recent hardening in international steel prices, it said, while cement price rises could be attributed largely to strong demand from construction domestically.
A survey of professional forecasters by the central bank showed that the Indian economy is expected to grow 8.1 per cent in the 2008-09 fiscal year that began this month. In 2007-08, the gross domestic product is estimated to have grown 8.7 per cent.
Meanwhile, the Lok Sabha is slated to pass the Finance Bill 2008-09 today.
The two-day US Federal Reserve policy meeting ends tomorrow. The market expects the Fed to cut interest rates by 25 basis points to two per cent.
Later, the current 30-share BSE Sensex was up 18.92 points or 0.10 per cent at 17,034.88. Sensex hit a high of 17,114.56 in early trade with day's low at 17,020.19 points.
The present broader based S&P CNX Nifty index of NSE was up by 2.55 points or 0.15 per cent at 5,087.10 from its last close of 5089.65. The nifty index resumed firm at 5092.40 points.
The BSE Mid-Cap index rose by 0.54 per cent to 7105.49 and BSE Small-Cap index rose by 0.58 per cent to 8,760.41.
The markets were trading with modest gain ahead of credit policy announcement. Buying interest seen in metal, pharma, consumer durable, auto stocks. About 1563 shares have advanced, 1291 shares declined, and 226 shares are unchanged. Top gainers on the bourses were Tata Steel, Jaiprakash Asso, Ranbaxy Labs, Dr Reddys Labs and Tata Comm. Top losers on the Sensex Bharti Airtel, BHEL and Infosys.
Most active shares on BSE are Rel Capital, Glenmark and Sesa Goa.
US markets finished flat as concerns about the Federal Reserve's rate decision kept a lid on activity. Wrigley shares soared 23 per cent on news that Buffett is teaming up with Candy Maker Mars to buy the gum maker for 22 billion dollars.
The interest-rate decision and Friday's Nonfarm Payroll Data are likely to dominate the market sentiment as the week progresses.
The Dow Jones industrial average slipped 20.11 points, or 0.16 per cent, to 12,871.75. The Standard&Poor's 500 index fell 1.47 points, or 0.11 per cent, to 1,396.37, and the Nasdaq composite index gained 1.47 points, or 0.06 per cent, to 2,424.40.
Asian markets were mixed. Hong Kong's Hang Seng gained 0.28 per cent 75.05 points at 25,738.34. However, Taiwan's Taiwan Weighted declined 0.25 per cent or 18.05 points at 9,057.34. Singapore's Straits Times were down by 0.77 per cent or 24.64 points at 3,176.99. South Korea's Seoul Composite fell 0.45 per cent or 8.14 points at 1,815.03.
Banking stocks rose. State Bank of India was up by 1.29 per cent to Rs 1,759 and HDFC Bank moved up by 0.66 per cent to Rs 1,527.95 edged higher. India's largest private sector bank by assets ICICI Bank rose by 0.53 per cent to Rs 899.95.
Auto Stocks edged higher. India's largest tractor maker by sales Mahindra&Mahindra gained by 0.73 per cent to Rs 639.90 followed by Maruti Suzuki India by 0.87 per cent to Rs 729.70, Hero Honda Motors by 0.23 per cent to Rs 820, Tata Motors by 1.01 per cent to Rs 640.
Reality stocks were mixed. Indiabulls Real Estate came down by 0.91 per cent to Rs 535.90 and Unitech dropped by 1.01 per cent to Rs 290.55. Lanco Infratech was up by 1.76 per cent to Rs 496.70 and DLF hiked by 0.61 per cent to Rs 672.60.
Tata Steel gained by 3.51 per cent to Rs 805 followed by Hindalco Industries by 1.5 per cent to Rs 189, Jaiprakash Associates by 1.51 per cent to Rs 254.95, ACC by 0.74 per cent to Rs 772.50 edged higher from Sensex pack, brokes added.