Markets to make a flat-to-positive start

The Indian markets surged over half a percent on getting an upbeat industrial production data. Today, the start is likely to be in green and traders will be drawing comfort from the macro side, as the consumer price index (CPI) inflation slowed to 5.17% year-on-year in March, compared to 5.37% in February. However, traders will be eyeing the WPI inflation data slated to be announced later in the day, for further cues. There will be some support with the International Monetary Fund (IMF) statement that India will overtake China as the fastest growing emerging economy in 2015-16 by clocking a growth rate of 7.5 percent on the back of recent policy initiatives, pick-up in investments and lower oil prices. Also, a senior American trade official has reportedly said that a series of reforms unleashed by India in recent months are “important steps” around open, predictable and rules based reforms. There will be some buzz in the oil & gas sector especially in Reliance Industries with the Union government telling the Supreme Court that the pricing of domestically produced gas comes under its “supervisory powers” and its dispute with Reliance Industries cannot be subjected to arbitration proceedings. Power stocks too will see some action, as the government has set a target of generating close to 1,100 billion units of electricity during the current financial year as the coal supply at thermal power stations has eased.Markets remained closed on Tuesday on account of a local holiday.

The US markets made a mixed closing in last session even though Commerce Department reported that retail sales rebounded in March following three straight monthly declines. Trade remained lackluster throughout the day. The Asian markets have made a mixed start and some of the indices are trading marginally in red, though there was some stimulus hopes keeping the Chinese market in green after its economy expanded at the weakest pace since 2009 last quarter.

Back home, resuming their northward journey after a day of halt, Indian equity benchmarks ended the session with a gain of over half a percent and frontline gauges recapturing their crucial 8,800 (Nifty) and 29,000 (Sensex) levels. Sentiments remained up-beat on reports that index for industrial output (IIP) for the month of February came in at 5%, way higher than street expectation of a number of around 3.50% and also higher compared to 2.6% in January, mainly on account of splendid growth of capital goods and consumer goods sector. Some support also came after Prime Minister Narendra Modi wooing German investors said that opportunities in India are “seamless” and huge for a vibrant economic partnership. He also assured that ‘Invest India’ has been set up and country desks in it that will be networked to the states, he said that we will nurture innovation and protect intellectual property. However, upside remained capped as investors stayed on sidelines ahead of CPI data for March which is slated to be announced later in the day, though all eyes this week will be on corporate performance of big companies like TCS and Reliance Industries. Global cues too remained supportive with European markets making a positive start and Asian markets ended mostly in the green. Back home, some support also came with reports that foreign institutional investors were net buyers in equities to the tune of Rs 363 crore on Friday, as per provisional stock exchange data. Meanwhile, power companies functioning in Delhi, like Tata Power showed some up move after they sought 20% hike in power tariff citing severe fund crunch. Select stocks from real estate sector too remained on buyers’ radar after HDFC and State Bank of India cut interest rates on housing loans. Additionally, shares of upstream oil exploration and production companies edged higher on increasing global crude oil prices. However, metal shares remained subdued after data showed that China’s imports contracted by 12.7% in March 2015 compared to the same month last year. Finally, the BSE Sensex surged 165.06 points or 0.57% to 29,044.44, while the CNX Nifty gained 53.65 points or 0.61% to 8,834.00.