Markets to make a flat-to-positive start; GDP data eyed

The Indian markets despite some late hour short covering snapped the F&O expiry session in red. Today, the start of the new series is likely to be flat-to-positive and traders will be eyeing GDP data for the March quarter. There has been wide debate on CSOs new method of calculating GDP which had earlier said that India’s real or “inflation adjusted” GDP in 2013-14 grew 6.9 percent instead of the earlier 4.7 percent and by 5.1 percent in the year before compared to 4.5 percent in the earlier system. Meanwhile, global credit rating agency, Moody's Analytics has said that India's economic growth rate in the January-March quarter is likely to slip to 7.2 percent from 7.5 percent in the previous three months, mainly on account of lower production and weak global demand. There will be some buzz in the aviation stocks, on the reports that the Civil Aviation Ministry would soon submit a draft note on the proposed changes in the controversial 5/20 norm to the Cabinet for approval. Infra stocks too will be in action as the government has said it will try to award road projects worth Rs 3.5 lakh crore in 2015-16 to boost infrastructure creation in the country.

The US markets despite regaining some ground in last session ended modestly lower in last session as uncertainty about the situation in Greece continued after International Monetary Fund Managing Director Christine Lagarde acknowledged that a Greek exit from the eurozone is a "possibility". The Asian markets have made mostly a positive start trimming their first monthly decline in 2015. The Chinese and Hong Kong markets have recovered from their last session’s fall, while the Japanese market was marginally in green too.

Back home, Indian equity markets truly depicted the choppiness of F&O expiry session on Thursday with key gauges ending the session with a cut of around two tenth of a percent. After a cautious start, markets traded range-bound throughout the session and ended the session slightly in the red. Sentiments weighed down after credit rating agency Moody’s said India’s economic growth rate in the January-March quarter is likely to slip to 7.2% from 7.5% in the previous three months, mainly on account of lower production and weak global demand. It also raised questions on the new GDP data series by the Central Statistical Organisation (CSO), which takes 2011-12 as the base year, saying that new data ‘is dubious’ as they do not align well with other indicators of economy.Muted corporate earnings, growing prospects that the Federal Reserve may raise interest rates and the F&O rollover pressures were further accentuated the nervousness on the Street. However, losses remained capped as some support came with industry body CII’s statement that India’s economy can grow at 9-10 percent in the medium-term with a multi-pronged economic strategy. It has outlined ten areas requiring policy attention that can bring huge economic benefits for growth, investment and employment creation. On the global front, European markets mostly started in the red, while the Asian markets ended mixed. Back home, sentiments remained dampened on report that foreign portfolio investors sold shares worth a net Rs 934.98 crore on May 27, 2015, as per provisional data. Market-men were also unable to get any advantage with the recovery in the currency, which after falling for three consecutive days has made a smart bounce back. The rupee was at 63.86 per dollar at the time of equity markets closing as compared to 64.01 per dollar level on Wednesday. Meanwhile, profit-booking on account of bad loan concerns dragged banking stocks lower. Finally, the BSE Sensex declined by 57.95 points or 0.21% to 27506.71, while the CNX Nifty lost 15.60 points or 0.19% to 8,319.00.