Nifty below 8650; HDFC, Sesa Sterlite, NTPC top losers

10:30am Inflation: Despite the CPI numbers coming in marginally worse than expected, Sonal Varma of Nomura expects inflation to stabilize over the next 3-6 months. But the path to inflation stabilization may be bumpy, she warns.

Core CPI, ex-fuel is closer to 5 percent versus the current 4 percent, she adds. Based on this and a few other factors, she believes the Reserve Bank is likely to stay on hold, going forward. According to her, the RBI has frontloaded rate cuts.

Varma sees business cycle recovery starting to come back. She says relative to manufacturing, it is the services side of the economy that is doing much better.

10:00am Market Check: The market fell further amid consolidation. The Sensex declined 62.13 points to 28441.17 and the Nifty dropped 21.10 points to 8626.65 led by index heavyweights HDFC, ICICI Bank and Reliance Industries.

The BSE Midcap and Smallcap indiceslost 0.5 percent each. The market breadth was weak too. About 743 shares have advanced, 1208 shares declined, and 144 shares are unchanged on the Bombay Stock Exchange.

Rakesh Arora, Macquarie says interest rate easing cycle, government-led infrastructure build and consumption growth revival should be the dominant themes for 2015-16.

According to him, industrials, autos and real estate provide the best opportunity to gain from the emerging trend. he recommends building long positions on dips.

HDFC plunged 2.5 percent on profit booking. A media report says Standard Life may raise stake in HDFC JV to 35 percent.

Shares of NTPC, Cipla, BhartiAirtel, Mahindra & Mahindra, GAIL and Hindalco Industries slipped 1-2.5 percent. Sesa Sterlite dropped over 3 percent. Reliance Industries and ICICI Bank declined nearly a percent.

However, HUL and Wipro climbed over a percent. HDFC Bank, TCS, Infosys, Tata Motors, L&T and SBI gained 0.3-0.9 percent. More information Please visit this site www.appsmine.org