Markets to make a cautious but green start of the new week

The Indian markets continued their bull-run for the sixth straight day in last session, closing higher by another over half a percent. Today, the start is likely to be in green, though in a range, with traders closely eyeing the developments in Greece. If there is a negative outcome of the emergency meeting in Brussels, it will be a depressing news for whole global markets. On the domestic front traders will be getting some advantage with Finance Minister Arun Jaitley’s statement on the basis of policy changes along with a good monsoon that the path to 10 percent growth in Indian economy is not impossible. Foreign investors too will be getting some respite as he terming the controversial retrospective taxation regime a “legacy issue”, has assured US investors that the government does not intend to legislate retrospectively and is looking to put a “quietus” to the matter. Infra sector stocks are likely to see some action, as Ministry of Statistics & Programme Implementation (MoSPI) has said that India's infrastructure performance in 2014-15 was better than the previous fiscal, as production of inputs including power, steel, coal and cement moved up. Also, to accelerate highways building and salvage stuck road projects, NHAI has asked developers to come forward with a financing plan and justification for the fund infusion that they are seeking from the authority. There will be some buzz in the market with NSE introducing an overnight liquid transaction facility on its web-based Mutual Fund platform, which will enable traders, especially small investors, to invest even for a single night in liquid funds.   

The US markets ended modestly lower in last session on some global concerns from China and Greece. The Asian markets have made mostly a positive start ahead of an emergency summit on Greece’s debt crisis, with the clock running down on a June 30 deadline to make payments.

Back home, extending their northward journey to sixth straight session, Indian equity benchmarks ended the session with gain of around three fourth of a percent on Friday. Markets traded with traction throughout the session as sentiments remained up-beat, with IMD stating that monsoon is expected to be normal in June boosting sowing of kharif crops but there are concerns about pick up in rainfall in the next month. Some profit taking was witnessed in noon deals, but markets regained momentum in last leg of trade to end comfortably above their crucial 8,200 (Nifty) and 27,300 (Sensex) bastions on the back of sustained buying across the board with RIL displaying a spectacular rally for the sixth straight session on optimism concerning the company’s 4G telecom services that is likely to roll out under the Reliance Jio brand in December. Some support also came with Finance Minister Arun Jaitley’s statement that a Parliamentary panel will in the second week of July submit its report on the Goods and Services Tax Bill. The Minister has also told the business community that the government will try to get the three supporting legislations for the implementation of the comprehensive indirect tax law in the subsequent sessions of Parliament. Finance Minister has also assured global investors that the Narendra Modi government is making efforts to allay their concerns over expediting reforms, the tax regime and policy stability. Global cues too remained supportive with European markets making a green start and Asian markets too ending mostly in green. Back home, domestic institutional investors (DIIs) bought shares worth a net Rs 1110.01 crore on June 18, as per provisional data by the stock exchanges. Appreciation in Indian rupee too supported the sentiments. Buying in software and technology counters too aided the sentiments after Nasdaq hit record highs, a day after the Federal Reserve indicated it would raise the interest rates slowly. Finally, the BSE Sensex surged by 200.34 points or 0.74% to 27316.17, while the CNX Nifty gained 50.35 points or 0.62% to 8224.95.