Markets to start the F&O expiry session on a cautious note

The Indian markets managed a flat closing in the last session but the mood remained cautious and the major indices after a positive start traded in a range. Today, the start is likely to be cautious and the trade may turn choppy in the latter part of the day ahead of the expiry of the May series, which has been a heavy one and traders may cover up positions with last few sessions of downtrend. Marketmen will also be eyeing the developments in different ministries; Finance Minister Arun Jaitley has asked the revenue department for a separate presentation on the proposed tax reform of goods and services tax (GST), while manufacturing sector may see a ray of hope with Commerce & Industry Minister Nirmala Sitharaman raising concern at sluggish growth in the manufacturing sector. There will be some buzz in the fertilizer sector too, as Ananth Kumar, Minister for Chemicals and Fertilisers has said that government will take steps to revive all closed urea plants and establish petrochemical hubs across the country.

There will be lots of important result announcements too, to keep the markets buzzing. 3M India, Ajcon Global, BHEL, BPCL, Cipla, DLF, Dunlop India, Fortis Healthcare, GMR Infra, Hindalco Inds, Indian Oil Corp are among many to announce their numbers today.

The US markets ended modestly lower in last session, consolidating and ending a four-day winning streak. Although there were good economic reports but traders opted to book profit after recent gains. The Asian markets have made a mixed start with some of the indices trading in red in early deals led by the Japanese markets after a report of a worse-than-estimated drop in nation’s retail sales. Japan’s retail sales fell 13.7 percent in April from March, the most in at least 14 years.

Back home, Indian equity indices went through consolidation on Wednesday as investors kept their positions on the penultimate day of May series futures & options (F&O) expiry. Benchmark indices moved in a narrow range for the major part of the day with bouts of volatility witnessed during the trade. Earlier, markets made a positive start supported by firm global cues, but profit taking played spoilsport and the domestic bourses plunged into the negative territory. Investors also remained cautious after Finance Ministry said that it has to be watchful of the Current Account Deficit (CAD) as well as the rupee because global markets are still volatile. However, markets managed to keep their head above water and eked out slender gains, as investors continued to buy beaten down but fundamentally strong stocks after previous session’s drubbing. On the global front, strong economic data in the United States shored up Asian stocks to one-year highs, European markets too traded slightly in the green in early deals on Wednesday. Back home, Software and technology continued to trade higher for second day in a row on good US economic data. Select stocks from realty counter moved up on a report that government is likely to grant infrastructure tag to low-cost housing segment, which will enable real-estate developers to get finance from banks and for longer tenures. Additionally, fertilizer stocks, namely Chambal fertilizers, National fertilizers, Zuari Agro gained after Fertilizer Minister underscored that government will take steps to revive closed urea plants. On the flip side, stocks related to aviation sector declined after Jet Airways posted its highest-ever net loss of Rs 2,154 crore in the fourth quarter ended March 31, impacted by higher operating expenditure and exceptional costs. Finally, the BSE Sensex added 6.58 points or 0.03%, to 24556.09, while the CNX Nifty was up by 11.65 points or 0.16%, to 7,329.65.