Indian markets to get a flat-to-positive start of new week

The Indian markets recovering from their choppiness ended higher in last session. Today the start is likely to be in green on hopes of some solution to the geopolitical tension. Traders after a long weekend will be eyeing value picking and in the absence of any major domestic trigger, will take cues from global factors mainly throughout the week. There will be some reaction to the Prime Minister Narendra Modi’s Independence speech where he presented government’s business-friendly side and invited global businesses to make India their manufacturing base. Besides, traders will be eyeing trend in investment by overseas investors, movement of rupee against the dollar and crude oil price. There will be some buzz in the infra sector on reports that Centre is readying to invite bids for Dholera investment region in Gujarat in the next three months and for integrated industrial townships in Greater Noida and Vikram Udyogpuri in Madhya Pradesh along the Delhi-Mumbai Industrial Corridor. Textile stocks too will be in action, as foreign direct investment (FDI) of $199 billion was made in India`s textile sector in the financial year 2013-14.

The US markets ended modestly lower in last session on escalating geopolitical tension, weakness in consumer sentiments too weighed on the sentiments. The Asian markets have made a mixed start and the regional indices are fluctuating in early deals after their five days winning streak, although foreign ministers of Ukraine and Russia began talks in Berlin, as European leaders push for an end to the conflict.

Back home, extending their gaining streak for fourth day in a row, Indian equity benchmarks staged an enthusiastic performance on Thursday, by rallying around three fourth of a percent and breaking lots of psychological levels in their northward journey. Sentiments remained positive since beginning of the trade and there appeared not even an iota of profit booking in the session as the benchmarks managed to fervently gain from strength to strength as investors continued hunt for fundamentally strong but oversold stocks. Sentiments also remained upbeat on report that foreign portfolio investors (FPIs) were net buyers of Indian stocks on August 13, 2014. On the macro front, India’s wholesale price (WPI) inflation eased to a five-month low in July, helped by a moderation in fuel costs. The WPI rose 5.19% year-on-year last month, its slowest pace since February. In June, prices rose 5.43% from a year earlier. Meanwhile, Reserve Bank of India’s (RBI) Governor Raghuram Rajan has stated that high interest rate structure may be painful in the short run but will help in long run by containing inflation. Recovery in European markets too aided the sentiments, however, Asian markets ended mostly in the red as downbeat data from China and Japan sparked renewed concerns for growth in the region’s two biggest economies.  Back home, there was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too equally participated in the rally. Frontline indices managed to settle near intraday high levels with Sensex surpassing its crucial 26,100 bastion, while Nifty ended near its crucial 7,800 mark. Appreciation in Indian rupee against dollar too aided sentiments. Finally, the BSE Sensex surged by 184.28 points or 0.71%, to 26103.23, while the CNX Nifty soared by 52.15 points or 0.67% to 7,791.70.