Markets to get a positive start of the new week

The Indian markets remained in consolidation mood for the second straight session, there was some cautiousness and profit booking in the latter part of the trade that dragged the markets lower. Today, the start is likely to be cautious but in positive terrain and Nifty may reclaim its 8100 mark on opening. However, traders will be cautious with lots of important macro data slated to be announced later in the week and Supreme Court’s hearing on the coal block case on Tuesday. Also, there will be some cautiousness with Reserve Bank of India governor Raghuram Rajan saying that aggressive monetary policy by developed economies may hurt global growth by pushing emerging markets to pile up foreign-exchange reserves instead of spending. There will be some buzz in the power sector stocks as the Union Power and Coal Minister Piyush Goyal has played down the coal shortages situation and has said that the government in 100 days had got the system to produce nearly 22 per cent more electricity and is on track to provide 24x7 power to all in five years. Exports and SEZs related companies may be in action, as the Export promotion body for special economic zones has asked the Finance Ministry to roll back or reduce the minimum alternate tax (MAT) and dividend distribution tax (DDT) on SEZs.

The US markets ended higher in last session as the lower than estimated jobs data fueled bets that Federal Reserve won’t rush to raise interest rates. The Asian markets have made a mixed start, though most are closed today, Chinese trade surplus climbed to a record as exports rose in August, while the Japanese market was slightly higher, despite the dollar's fall and poor growth data.

Back home, extending their consolidation mood for second day in a row, Indian equity benchmarks ended the Friday’s session slightly in the red on the back of feeble global cues. It turned out to be a choppy day of trade for the domestic markets, where key indices got off to a positive start, but surrendered all their gains in late morning deals to languish into the negative terrain thereafter. Though, some amount of recovery was witnessed in last leg of trade but it was not enough to pull benchmarks into positive trajectory. Meanwhile, investors remained on sidelines ahead of Consumer Price Index (CPI) and Index of Industrial Production (IIP) data scheduled to be released next week. Losses remained capped on report that heavy showers across north and northwest India, narrowed the overall monsoon deficit in the country to 14% and has accelerated crop growth. Some support also came on report that the government may allow EPFO to invest in the stock markets, potentially making this the biggest source of domestic institutional investment after LIC. Meanwhile, foreign portfolio investors (FPIs) bought shares worth a net Rs 1697.74 crore on September 4, 2014, as per provisional data from the stock exchanges. Sluggish opening in European counterparts too dampened the sentiments, while Asian markets ended mostly in the red following the European Central Bank’s surprise rate cut. Back home, depreciation in Indian rupee too dampened the sentiments after the US dollar firmed up against other Asian currencies. Meanwhile, power sector witnessed selling despite report that Power traded at the spot market increased last month to 2.5 billion units (BUs) due to high demand amidst weak monsoon and fuel shortages. Finally, the BSE Sensex declined by 59.23 points or 0.22%, to 27026.70, while the CNX Nifty lost 9.10 points or 0.11% to 8,086.85.