Mumbai, Sep 16 (IANS): Reduced chances of a US rate hike, coupled with foreign fund inflows and value buying, lifted the Indian equity markets during the mid-afternoon trade session on Friday.

Besides, healthy macro-economic data on foreign trade and positive Asian markets aided in the initial upward trajectory. However, a correction in the key European indices and the upcoming rate-setting meeting of the US Fed capped gains. 

Both the key indices traded with gains of more than half a per cent each, as healthy buying was witnessed in fast moving consumer goods (FMCG), automobile, and oil and gas stocks.

The wider 51-scrip Nifty of the National Stock Exchange (NSE) edged up by 48.60 points or 0.56 per cent to 8,791.15 points.

The barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 28,520.30 points, traded at 28,591.39 points (at around 3 p.m.) -- up 178.50 points or 0.63 per cent from its previous close at 28,412.89 points.

The Sensex has so far touched a high of 28,778.64 points and a low of 28,520.17 points during the intra-day trade.

However, the BSE market breadth was marginally tilted in favour of the bears -- with 1,418 declines and 1,275 advances.

On Thursday, both the key Indian indices had closed on a flat-to-positive note, on the back of short covering, coupled with value buying at lower levels and inflow of foreign funds 

The barometer index had risen by 40.66 points or 0.14 per cent, while the NSE Nifty edged up by 15.95 points or 0.18 per cent.

Initially on Friday, the benchmark indices opened in the green on the back of positive Asian markets.

"Lessened chances of a US rate hike on the back of tipid data, positive Asian markets and return of the foreign fund inflows pushed the equity markets higher," Anand James, Chief Market Strategist at Geojit BNP Paribas Financial Services, told IANS.

"However, a correction in the key European markets and the upcoming rate-setting meet of the US Fed capped gains."

According to Dhruv Desai, Director and Chief Operating Officer of Tradebulls, while the CNX Nifty showed some recovery from lower levels due to short covering, the Bank Nifty faced some selling pressure and traded volatile.

"IT stocks witnessed some recovery from lower levels. Banking and pharma stocks traded with mixed sentiments," Desai said.

"Auto and oil-gas stocks also traded with mixed sentiments due to profit booking. Most power and FMCG stocks traded with sideways sentiments due to profit booking at higher levels."