* NSE index up 0.26 pct, BSE index 0.30 pct higher
* Sun Pharma surges after qtrly results
* Zee among top losers
By Arnab Paul
Feb 13 (Reuters) - Indian shares rose, 10-year bond yields slid while the rupee strengthened on Wednesday amid bets the nation’s central bank will cut interest rates after consumer prices rose at a slower-than-anticipated pace.
Annual retail inflation in January rose 2.05 percent, its slowest pace since June 2017, compared with a forecast of 2.48 percent by 30 analysts polled by Reuters.
With inflation coming below the Reserve Bank of India’s target for a sixth straight month, analysts believe the central bank could cut the key interest rate at its next policy review in April after a surprise reduction in repo rate last week.
“The retail inflation number was much lower than the market expectations,” said Tushar Arora, a senior economist at HDFC Bank.
“This reinforces expectations of a rate cut in April.”
This, along with Prime Minister Narendra Modi’s incentives to farmers and tax benefits to the middle class, is likely to spur consumer spending, boosting the market ahead of the general election by May.
The 10-year benchmark government bond yield fell to 7.44 percent from Tuesday’s close of 7.53 percent, while the rupee opened at 70.48 to the dollar compared to the previous close of 70.65. The rupee was last at 70.56 to the dollar.
The broader NSE index rose 0.26 percent to 10,859.75 as of 0551 GMT, while the benchmark BSE index added 0.30 percent at 36,260.65.
“The market will move with company-specific news like earnings because it’s rangebound between 10,550 and 11,000 till the elections are done and dusted,” said Gaurang Shah, senior vice president at Geojit Financial Services in Mumbai.
Sun Pharmaceutical Industries Ltd gained as much as 4.2 percent after reporting a nearly four-fold surge in quarterly profit on Tuesday.
Consumer stocks were among the top gainers, with index-heavyweight ITC Ltd rising more than 2 percent.
Among the decliners, Zee Entertainment Enterprises Ltd fell 2.3 percent and was among the top losers on the NSE index after certain promoter entities sold stakes in the company.
Shares of CG Power and Industrial Solutions Ltd slumped 13 percent after the company reported a quarterly loss of 1.50 billion rupees ($21.28 million). ($1 = 70.4750 Indian rupees) (Reporting By Arnab Paul in Bengaluru; Editing by Shreejay Sinha)