Markets to make a green but positive start

The Indian markets despite some choppiness in last session, extended the upward trend seen over the past several sessions. Though, the major indices managed a green close but there were many instances of profit taking. Today, the start is likely to be cautious but in green on positive global cues. There will be some concern with Asian Development Bank saying that a global failure to respond to climate changes could result in about 8.7 percent economic loss in India`s Gross Domestic Product (GDP) by 2100. Also, the Indirect tax mop up inched up merely by 3.9 percent in the April-July quarter of the current fiscal due to decline in custom duty and excise duty collections. The growth is far less than 25 percent annual increase envisaged in the Budget. There will be some buzz in the markets with Sebi Chairman UK Sinha saying that recent amendments to the Sebi Act enabling it to easily access call data records will make it easier for it to prove insider trading charges. There will be some action among the power stocks on government plans to create public sector energy giants with a massive restructuring exercise that will amalgamate all state-run hydropower firms and transfer their thermal projects to NTPC to create strong companies that can take on the rapidly growing private conglomerates. PSU oil marketing companies are likely to continue their jubilation amid falling crude oil prices that hit a 13-month low.

The US markets extended their upward trend in last session on the back of two good reports on consumer price inflation and new residential construction. The gains once again lifted the tech-heavy Nasdaq to a new fourteen-year closing high. The Asian markets have made mostly a green start and the regional indices are trading near six-year high as concern eased over global political conflicts.

Back home, Indian equity benchmarks scaled yet another lifetime closing high levels on Tuesday amid firm global cues. Domestic gauges traded in tight band throughout the session and ended with marginal gains, extending their northward journey for sixth straight session. Though, markets threatened to slip below neutral line for couple of times, but each the attempt was reciprocated with recovery. Sentiments remained up-beat with the report that India has touched the top spot in consumer confidence among the 60 countries measured in Nielsen’s Global Survey of Consumer Confidence and Spending Intentions in the second quarter (April-June) of 2014. Some support also came after the Federation of Indian Export Organisations (FIEO) has stated that India’s exports can surpass the $350-billion target for 2014-15 fiscal as growth in the manufacturing sector is expected to pick up pace. Global cues too remained supportive with European counters making a firm start, while Asian markets rallied. Back home, sentiments also remained up-beat on report that domestic institutions were net buyers to the tune of Rs 490 crore while foreign institutional investors were net buyers to the tune of Rs 473 crore on Monday, as per provisional stock exchange data. Meanwhile, the Indian rupee firmed up against the US dollar on the back of dollar inflows after domestic stock markets surged to record highs. Meanwhile, auto stocks remained on buyers’ radar on the back of encouraging sales growth in July. Auto sales in India rose for the second straight month, according to July sales data released by individual auto makers, suggesting that a recovery may have begun to take hold in the sector after a two-year slump. Finally, the BSE Sensex added 29.71 points or 0.11%, to 26420.67, while the CNX Nifty gained 23.25 points or 0.30% to 7,897.50.