Markets to remain jubilant with a good start

The Indian markets surged in last session with funds buying returning to the street after a brief pause. Both the benchmarks soared to their all-time highs. Today, the start is likely to remain jubilant and the markets will extend the gains on positive global cues, traders may continue to focus on stocks and sectors in the run-up to the Union Budget, which could benefit from possible pro-business measures. However, Macroeconomic data, progress of monsoon rains and global cues are likely to dictate trend on the domestic bourses throughout the week. Market men will be getting some comfort with Minister of Commerce Nirmala Sitharaman’s statement that the rising Current Account Deficit (CAD) and galloping prices are the issues which will be tackled on an urgent basis by the government and Finance Minister will announce important measures to reduce the CAD and curb rising prices. However, there will be some concern too, as the foreign direct investment in the services sector declined by about 54 per cent year-on-year to $2.22 billion last fiscal. Today, there will be some buzz in the pharma sector, as the department of industrial policy & promotion (DIPP) has sought more restrictions, especially on portfolio investment in the sector.

The US markets continued their upmove and ended higher on getting good jobs data, while the unemployment rate held steady, lower than expected. The Asian markets have made a good start with some of the indices headed for a more-than seven-month high after Chinese trade and Japanese economic-growth data beat estimates.

Back home, extending their previous session rally, boisterous benchmarks showcased an enthusiastic performance on Friday with bull taking full control of the session as investors continued hunt for fundamentally strong stocks. Earlier, markets after a gap-up opening traded in very tight-band for most part of the day but massive buying in last leg of trade mainly underpinned markets to clock record closing high. Meanwhile, monsoon rains reached India’s southern coast of Kerala today, offering relief to farmers eagerly waiting for the start of the wet season that is crucial for their summer crops. Appreciation in Indian rupee too aided sentiments. The rupee was trading at 59.19 at the time of equity markets closing as compared to its previous close of 59.33. Some confidence also came after Finance Minister Arun Jaitley, in a pre-Budget consultation with agriculturists, assured them that despite resource constraints, the Government would try its best to boost the sector. Northward journey got extended after European markets made a positive opening, however, Asian counters ended mostly in the red. Back home, there was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too participated strongly in the rally. Frontline indices ended the session near their day’s high levels with Sensex settling just shy of its crucial 25,400 levels, while Nifty ended above its psychological 7,550 mark, as investors took to hefty across the board buying.  Meanwhile, stocks related to sugar space remained on buyers’ radar after the government said that it was examining the possibility of giving additional interest-free loans of Rs 4,400 crore to cash-starved sugar mills to clear dues to cane farmers. Finally, the BSE Sensex soared by 376.95 points or 1.51%, to 25396.46, while the CNX Nifty surged by 109.30 points or 1.46%, to 7,583.40.