Analysts are keenly watching inflation data which is due later today. A higher reading would ensure that the RBI does not act on further monetary easing when it meets on July 31, 2012 to review its monetary policy. This could certainly be bad news for the markets. Analysts broadly expect inflation for June to be around 7.6%.

In Asia, most of the indices rose on speculation of further monetary easing as weakening of China's global economy continues.The Japan's Nikkei 225 was up by 0.05%, the Hang Seng index was higher by 0.18%, while China's Shanghai Composite was down by 1.02%.

On Friday, markets closed in the red for the third day in a row as profit booking in the last hour of trade saw equities lose ground.

Among the shares that gained ground in morning trade were Bharti Airtel, SBI, Hindalco and DLF.

Stocks that failed to lure investors in early trade were Tata Steel, Reliance Infrastructure, Jindal Steel and Gail.

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