Markets to make a strong start on jubilant global cues

The Indian markets extended the consolidation mood in last session going for a holiday, lacking any major supportive cues. Today, the start is likely to be good on jubilant global cues and Nifty can reclaim the 8300 mark in initial trades. Market participant will be getting additional support with a Moody's Investors Service’s report stating that India will clock the highest growth rate of 7-7.5 per cent among G20 economies in 2015 and 2016. It has said that India is less exposed to global risks because of its more resilient economic growth and the impact of positive policy reforms momentum. Also, the Grant Thornton International Business Report (IBR), a quarterly global survey has stated that India Inc is the second most optimistic in terms of business optimism globally. There will be some buzz in gold and banking stocks, as the Reserve Bank has issued guidelines for the Gold Monetisation Scheme that allow banks to fix their own interest rates on gold deposits. On the other hand, Iron and steel stocks will be under pressure, as the India's iron and steel exports plummeted by 41 percent to $4.57 billion in September against $7.69 billion a year ago, hit by a subdued economic sentiment mainly in the commodities market. There will be lots of result reactions too, to keep the markets buzzing for the day.

The US markets rallied in last session, on some positive economic news and reacting positively to ECB President Mario Draghi signal that the bank will consider providing further stimulus. The Asian markets have made a strong start taking cues from the US markets on the ECB President’s comments, as it is the latest central bank to switch to a more preservative tone on stimulus.

Back home, Indian equity benchmarks ended a choppy day of trade on a flat note, with a negative bias, amid selling in financial, pharma and capital goods shares. Earlier, markets traded in fine fettle in early deals supported by US Treasury Department report that amid weaker outlook across emerging market economies India's recovery has strengthened under a new reform agenda, since it is not a large importer. Traders also got some encouragement with the statement of finance ministry that the country will grow by 7.5 per cent in the current fiscal, slightly higher than international rating agency Standard & Poor's latest forecast, saying the government will roll out more reforms measures to push growth.  However, markets took U-turn in noon deals, tracking a slump in China markets which got pounded by over three percent. Sentiments also remained dampened after report that government deferred a decision on convening the Winter Session of Parliament till next week, amid indications that it could be summoned any day after November 19. But a final decision will be taken by the Cabinet Committee of Parliamentary Affairs (CCPA) on October 26. On the global front, European counters opened flat with a negative bias, while Asian markets ended mostly in green. Back home, depreciation in Indian rupee too weighed down sentiments. However, some support came with reports that foreign portfolio investors (FPIs) bought shares worth a net Rs 523.69 crore on October 20, 2015, as per provisional data released by the stock exchanges. Meanwhile, oil producing companies remained under pressure after international crude prices fell with data from an US industry group showing a larger-than-expected build in US crude inventories last week. Finally, the BSE Sensex declined by 19.17 points or 0.07% to 27287.66, while the CNX Nifty lost 9.95 points or 0.12% to 8251.70.