India shares bounce around; ONGC down, Bharti gains

(Updates to mid-morning)

MUMBAI, May 14 (Reuters) - Indian shares swung between
losses and gains on Wednesday morning, with software-service
exporters gaining from a weakening rupee but top oil explorer
Oil and Natural Gas Corp (ONGC) (ONGC.BO: Quote, Profile, Research) down on fears of a
rising subsidy burden.
Leading mobile operator Bharti Airtel (BRTI.BO: Quote, Profile, Research) rose 2.1
percent to 838.50 rupees after saying it was still in
exploratory talks with South Africa's MTN Group (MTNJ.J: Quote, Profile, Research) and
there was no requirement to make a bid. [ID:nBOM54018].

Shares in ONGC, India's second-biggest firm by market
value, fell 5.4 percent to 943.75 rupees, on fears it would be
forced to offer higher discounts to state-run refiners, even
though crude oil CLc1 rose to record high of $126.98 a barrel
on Tuesday.

India imports 70 percent of its oil, and caps retail prices
of petrol and diesel to rein in rising inflation.

"The current problem in the market is related to crude
oil," said Deven Choksey, CEO and managing director at K.R.
Choksey.

"We are in a growth phase now and high oil prices are
definitely impacting us, forcing the government to take
measures which are leading to a slowdown in the economy," he
said.

At 10:52 a.m. (0452 GMT), the 30-share BSE index
was up 0.12 percent, or 20.02 points at 16,772.88, with 19
components in the red. The index, which fell as much as 0.75
percent in early deals, is down more than 17 percent in 2008.

In the broader market, 1,082 gainers beat 986 losers on a
volume of more than 88 million shares.

Shares in export-driven software-services providers rose as
the rupee fell to 13-month lows around 42.30 per dollar, taking
its losses in 2008 to almost 7 percent.

Sector leader Tata Consultancy Services (TCS.BO: Quote, Profile, Research) gained 1.4
percent to 918.20 rupees and second-ranked Infosys Technologies
(INFY.BO: Quote, Profile, Research) rose 0.8 percent to 1,797 rupees.

The outsourcing sector earn mores than half its revenue
from the United States, and the rupee's 12 percent-plus rise
against the dollar last year had squeezed firms' margins.

Banking stocks were hit globally after U.S. Federal Reserve
chairman Ben Bernanke said strained conditions in financial
markets would take time to normalise.

Top private lender ICICI Bank Ltd (ICBK.BO: Quote, Profile, Research) eased 0.3
percent to 885.50 rupees, and HDFC Bank (HDBK.BO: Quote, Profile, Research) fell 1.8
percent to 1,455.60 rupees.

The 50-share NSE index eased 0.09 percent to
4,953.10.

Elsewhere in the region, Karachi's 100-Share index
was down just 0.06 percent at 14,534.34, while Colombo's
All-Share index .CSE had gained 0.3 percent to 2,621.15.

STOCKS ON THE MOVE:

* Software services firm MphasiS Ltd (MBFL.BO: Quote, Profile, Research), majority
owned by Electronic Data Systems Corp (EDS.N: Quote, Profile, Research), rose 2.5 percent
to 248.40 rupees, extending Tuesday's 9.9 percent rise on
Hewlett-Packard Co's (HPQ.N: Quote, Profile, Research) plans to buy EDS. [ID:nN13368428].

* Hindustan Zinc Ltd (HZNC.BO: Quote, Profile, Research) rose 6 percent to 664 rupees
after Shanghai Zinc jumped by its 4 percent daily limit on
overnight gains in London. [ID:nSP160].

* State-run Shipping Corp of India (SCI.BO: Quote, Profile, Research) gained 6
percent to 258.10 rupees after it said its board will consider
a proposal to recommend an issue of bonus shares to the
Ministry of Shipping, Road Transport & Highways.

* State-run BEML Ltd (BEML.BO: Quote, Profile, Research) was up 1.4 percent to 1,135
rupees after it signed an agreement with Steel Authority of
India (SAIL.BO: Quote, Profile, Research) to supply earth-moving equipment and spares.
[ID:nBOM14373].

MAIN TOP 3 BY VOLUME:

* Aishwarya Telecom Ltd (AISH.BO: Quote, Profile, Research) on 25.7 million shares.

* IFCI Ltd (IFCI.BO: Quote, Profile, Research) on 7.2 million shares.

* Ispat Industries Ltd (ISPT.BO: Quote, Profile, Research) on 3.8 million shares.

FACTORS TO WATCH
* For technical analysis double-click on www.reutersindia.net
* Indian rupee at 13-mth lows on oil, growth worries
[INR/]
* Indian bond yields rise ahead of supply
[IN/]
* FOREX-Dollar firm vs yen, euro after solid US retail sales

[FRX/]
* Oil steady below $126, eyes Iran, US stock build
[O/R]
* GLOBAL MARKETS-Asian stocks flat as oil stays near record
high
[MARKETS/AS]
* US STOCKS- Oil, financials hit Dow; techs lift Nasdaq
[.N]
* For closing rates of Indian ADRs
INADR
(Reporting by Hiral Vora & Virendra Verma; Editing by John
Mair)