BSE Sensex seen higher; Cairn may rise

A man walks past the Bombay Stock Exchange (BSE) building in Mumbai September 21, 2010.

MUMBAI (Reuters) - The BSE Sensex is expected to open higher on Wednesday after a shift in stance by the Reserve Bank of India (RBI) to bolster growth raised expectations for more foreign fund investments.

The RBI slashed cash reserve requirement for banks by 50 basis points on Tuesday to help ease tight liquidity, but kept rates unchanged due to high core inflation.

"We could give another bump up ... but you will not have a one way street from here," said Ambareesh Baliga, chief operating officer at Way2Wealth.

He said the main 30-share BSE index .BSESN, which has gained 10 percent this month, could see some profit-taking.

Trading could be choppy because of the expiry of monthly derivatives contracts.

Cairn India may rise after the oil explorer reported a 12.5 percent rise in its December quarter earnings.

Top-listed biotechnology firm Biocon (BION.NS) is likely to fall after its quarterly net profit fell 15.8 percent.

Asian shares rose on Wednesday underpinned by strong earnings from U.S. technology giant Apple Inc (AAPL.O), stabilising European money markets and falling euro zone debt yields, with investors shifting their focus to the Federal Reserve from Europe.

At 0224 GMT, the MSCI's broadest index of Asia Pacific shares outside Japan and the Nifty India stock futures in Singapore were both up 0.8 percent.

STOCKS TO WATCH

* Indian Hotels Company (IHTL.NS), Tata Global Beverages (TAGL.NS), Union Bank of India (UNBK.NS), Bank of Baroda (BOB.NS) and Tata Communications (TATA.NS) report quarterly earnings on Wednesday.

* Indiabulls Real Estate (INRL.NS) could fall after its December quarter net profit slumped 45.5 percent.

* Grasim Industries (GRAS.NS) may rise after its October-December net profit rose 33.3 percent.

* GMR Infrastructure (GMRI.NS) after an official told Reuters, the company withdrew its bid to modernise and expand an airport in Croatia but is preparing to bid on similar projects in Brazil.

(Reporting by Ketan Bondre and Kaustubh Kulkarni; Editing by Ranjit Gangadharan)