Markets to make a cautious start, may see some upmove in latter trade

The Indian markets were butchered in last session under influence of Chinese free fall. Today, the start is likely to be cautious and some stabilization can be expected after the steep fall. Traders will be getting some support with global rating agency Standard & Poor's statement that the confidence level in India continues to grow amid indications of slower growth ahead for the Asia-Pacific region. Also, the government has said that it was closely monitoring the Greek crisis and is prepared to face any situation in view of its 'comfortable' foreign exchange reserves. There will be some buzz in the PSU stocks, with the government permitting seven public sector units to raise Rs 40,000 crore through tax-free bonds in the current financial year. Some action can be seen in oil & gas stocks too, with India inviting Canadian firms to invest in energy infrastructure and offered to jointly underwrite large projects like LNG terminals as well as refinery and petrochemical plants. IT stocks too will be in lime light with the official start of the earning season by TCS numbers after the market hours.

The US markets tumbled in last session, with Dow being dragged to its five-month closing low, as Chinese stocks extended their recent steep decline despite a series of market-stabilizing measures by authorities. The Asian markets have made mostly a soft start, though some of the indices including the Chinese market have erased their early losses, with the country bolstering efforts to aid the market. The regulator has banned major stockholders from selling stakes in listed companies.

Back home, Wednesday’s trading session turned out to be a daunting one for stock markets in India and benchmarks ended below their crucial 27,700 (Sensex) and 8,400 (Nifty) levels. Sentiments remained down-beat since beginning of the trade on the back of collapse in the Chinese equities amid the ongoing Greece crisis. Though, some support came in last leg of trade after the Greek Prime Minister Alexis Tsipras told the European Parliament that Greece will submit a detailed reform proposal to its international creditors in the next few days. The recovery proved short-lived and markets ended the session with a cut of over one and a half percent. There was no support from any corner and traders looked cautious not only with the global development but also about the corporate profit growth, as the first quarter earnings kick starts tomorrow with TCS numbers. Meanwhile, global rating agency CRISIL said India Inc results for the quarter ended June 2015, to disappoint as soft commodity prices, weak growth in investment-linked sectors and subdued rural demand restrict earnings. Investors remained on sidelines ahead of Index of Industrial Production data (IIP) scheduled to be released on Friday. Asian markets ended in red as the plunge in Chinese markets and Greece’s debt crisis continued, however, the European markets stabilized in Wednesday’s session. Back home, selling was both brutal and wide-based as none of sectoral indices on BSE were spared. Counters, which featured in the list of worst performers, include metal, auto and realty. Depreciation in Indian rupee too dampened the sentiments. Meanwhile, metal counter fell around four percent tracking stock market crash in China and in wake of the fact that LMEX, a gauge of six metals traded on the London Metal Exchange (LME) dipped by 4% on Tuesday. Finally, the BSE Sensex plunged by 483.97 points or 1.72% to 27687.72, while the CNX Nifty declined by 147.75 points or 1.74% to 8363.05.