Markets to remain in consolidation mood with a cautious start

The Indian markets, lost their momentum in second half of the last session and ended with cuts of about a quarter percent. Today, the start is likely to remain cautious as the global bourses too are showing sluggish trend, though markets will be getting some support with the Asian Development Bank’s (ADB’s) latest Outlook report, saying that developing Asia, which groups 45 countries in Asia-Pacific, is set to grow 6.3 per cent this year and the next, the same pace as in 2014. India and most Southeast Asian economies will lead the way, offsetting slowing growth in China. Meanwhile, the Union government will borrow Rs 3.6 lakh crore from markets in the first half of the next financial year, which is over 50 percent of the annual target of Rs 6 lakh crore. There will be some buzz in the exports oriented stocks, as the Commerce and Industry Minister Nirmala Sitharaman has said that the government will soon unveil the much-delayed Foreign Trade Policy (FTP) which is expected to roll out steps to boost exports. The metals and mining stocks too will keep buzzing, as the government is all set to auction another set of 15-20 coal blocks next month following passage of the coal mines bill in Parliament.

The US markets ended marginally in red in last session, as traders seemed reluctant to make any significant moves amid lingering uncertainty about the monetary policy outlook, although there was a report of rebound in existing home sales. The Asian markets have made a mixed start with some of the indices in pressure due to a flash report showing Chinese manufacturing gauge fell to an 11-month low in March.

Back home, Indian equity benchmarks, erasing all their initial gains, extended their losing to fourth straight day and ended the session marginally in the red on Monday on lack of fresh triggers. Sentiments took U-turn in noon deals as investors opted to book profit ahead of March F&O expiry on Thursday. However, losses remained capped as sentiments remained up-beat on report that international credit rating agency Fitch’s latest report on Global Economic Outlook saying that India is the only BRIC nation, where growth will accelerate, to 8 per cent in FY16 and 8.3 per cent in FY17, based on revised data series. Some support came with reports that foreign portfolio investors (FPIs) bought shares worth a net Rs 354.59 crore on March 20, 2015, as per provisional data. Selling got intensified as European counters made a weak opening, while the Asian markets ended mixed. Back home, sentiments weighed down by reports that domestic institutional investors (DIIs) sold shares worth a net Rs 219.20 crore on March 20, 2015, as per provisional data. Sentiments remained dampened after selling witnessed in software and technology counters on rupee’s strength. Moreover, banking shares too edged lower after the Capital market regulator Securities & Exchange Board of India (Sebi) in a board meeting on March 22, 2015 stated that banks can convert debts of defaulting publicly traded borrowers into equity. On the flip side, metal and mining stocks advanced after the government in a commendable act succeeded in the passage of two key reform bills the Mines and Minerals Bill and the Coal Mines Bill in Rajya Sabha. Telecom stocks too remained in limelight after at the end of the 16th day of bidding for spectrum about 88% of the spectrum has been provisionally allocated to bidders at a value of approximately Rs 1.07 lakh crore. Finally, the BSE Sensex declined by 69.06 points or 0.24% to 28192.02, while the CNX Nifty lost 20.00 points or 0.23% to 8,550.90.