Markets to continue the bullish trend with a positive start

The Indian markets making a smart bounce back in last session surged by around half a percent with buying returning in the beaten down sectors. Today, the start is likely to be in green and the major bourses to extend their gaining momentum. Markets will be getting some support with Union Ministry of Commerce and Industry allaying fears over Free Trade Agreements (FTAs), saying that FTA pacts may not lead to trade deficits. Meanwhile, Finance Minister Arun Jaitley has said India is ranked fairly low in ease of doing business. There is likely to be buzz in the infra sector stocks, as the government approved over Rs 8,600 crore of highway projects in Uttar Pradesh, Odisha and Chhattisgarh. Sugar stocks too will be in action, as the Cabinet Committee on Economic Affairs (CCEA) has approved the continuation of the incentive scheme for marketing and promotion services of raw sugar production during 2014-15 (October-September) for a quantity of 1.4 million tonnes.

The US markets made another mixed closing in last session, with Nasdaq extending its winning streak. Uncertainty about the situation in Greece kept the market mood cautious, though traders remained optimistic a deal will eventually be reached. In the Asian region while still lots of markets are not trading, but those who are trading have made a positive start.

Back home, Indian equity benchmarks extended their rally to seventh straight session and accumulated gains of around half a percent on Thursday, on account of hectic buying activity witnessed in the last leg of trade, as investors piled up position in the run-up to budget, which is scheduled to be presented on February 28. Earlier, after a positive start, markets entered into negative terrain in noon deals as investors booked some of their profits at higher levels. The indices even went on to test important psychological 29,200 (Sensex) and 8,800 (Nifty) levels, but the key gauges got strong support around those intraday low levels as they convalesced from thereon.  Recovery which took place in last hour of trade mainly helped benchmarks to regain their positive trajectory as investors remained hopeful of faster reforms in the government’s 2015-16 fiscal budget, after global rating agency Fitch said that it was expecting a slew of reforms in the upcoming Union Budget and any deviation from fiscal consolidation path could be a negative for its investment grade rating for India. Some support also came with report that foreign institutional investors were net buyers in equities after they bought equities worth Rs 2,188 crore on Wednesday, as per the provisional stock exchange data. On the global front, European counters which made a somber start, while the lone trading Asian market Nikkei surged to its fifteen months high. Back home, buying in metal counter too supported the sentiments with companies getting coal mines allocated under the ongoing auction. Jindal Steel and Power surged over 25% on retaining its two coal blocks Gare Palma IV/2 and Gare Palma IV/3 in Chhattisgarh for a surprisingly low winning bid of Rs 108 per tonne. Coal from these blocks will primarily be linked to JSPL's 1000 MW Tamnar-1 power plant in Chhattisgarh. Shares related to jewellery sector too remained on buyers’ radar as the Reserve Bank of India (RBI) permitted banks to resume lending against gold to jewellers. The RBI has also lifted the ban on imports of gold coins and medallions. On the flip side, Stocks related to cement space edged lower after Ambuja Cement reported less-than-expected profit in its fourth quarter ended December 31, 2014 and as Minister of Road Transport and Highways Nitin Gadkari slamming the cement industry for indulging in cartelization said that he will be approaching Prime Minister Narendra Modi over the issue of cartelization by the industry. Finally, the BSE Sensex surged by 142.01 points or 0.48% to 29462.27, while the CNX Nifty gained 26.20 points or 0.30% to 8895.30.