Markets to make a strong start on jubilant global cues

The Indian markets managed to break the losing streak in last session, with the indices despite volatility making a modestly green close. Today, the start is likely to be good tailing the rally in the Asian peers. Traders are also likely to get some support with report of India topping in the Nielsen’s global confidence index. The country’s confidence level was unchanged from the preceding quarter at 131 points, though the survey revealed that citizens are actually saving more than before in a continuing trend of caution, and their spending habits haven’t changed much over the past two quarters. The banking stocks will be in action, as the finance ministry has stepped in to resolve differences between the banking and insurance regulators over whether insurance companies should provide capital to state-run banks. The gems and jewellary stocks too are likely to be in action with industry body Assocham seeking industry status to the Gems and Jewellery sector to give it the much needed boost. Also, the Reserve Bank of India has fixed the public issue price at Rs. 2,684 per gram for the sovereign gold bonds, for which applications will be accepted from November 5 to 20. The exports oriented stocks too will see some action, as a United Nations report has said that exports from India and Vietnam are expected to relatively do well in 2016 as their shipments are largely directed to advanced economies in Europe and North America. There will be lots of earnings announcements too, to decide the direction of the markets latter in the day. 

The US markets ended modestly higher in last session, shrugging off a report from the Commerce Department showing that factory orders saw further downside in the month of September. The Asian markets have made a strong start, extending a global rally on return of risk appetite. 

Back home, Indian equity benchmarks managed to keep their head above water and ended the session marginally in green as investors opted to buy beaten down but fundamentally strong stocks after six sessions of continuous drubbing. Overall sentiments remained up-beat with Moody's Investors Services projecting stable growth rate for India and stating that the economy would grow at 7.5 percent in the current fiscal and improve marginally in the following year. It expects India's real GDP to grow at 7.5 percent in the financial year ending March 31, 2016 (FY16) and 7.6 percent in FY17. Traders also drew some encouragement with eight core sectors rising to 4-month high of 3.2 percent in September because of sharp pick-up in fertiliser production and electricity generation. Core sector that comprises nearly 38 percent of India’s total industrial production had grown at 2.6 percent in the same month of last year. Global cues too remained supportive with Asian markets ending mostly in green, though European counters traded mostly in red in early deals. Back home, traders pared most of their initial gains in last leg of trade and domestic bourses dipped in red couple of times but somehow managed to end up in green. Gains remained capped on account of disappointing Q2 numbers from some of the corporate firms. Oberoi Realty declined after its September quarter earnings came in below the estimates while, rating agency CARE reported 27.78% fall in its net profit at Rs 37.85 crore for the quarter ended September 30, 2015. Depreciation in Indian rupee too weighed down sentiments. The partially convertible rupee was trading at 65.68 per dollar at the time of equity market closing against the Monday’s close of 65.59 on the Interbank Foreign Exchange. Stocks related to banking space, that were trading mostly in green in early deals ended up in negative terrain after Fitch Ratings said that formation of stress assets of Indian banks' is likely peak this fiscal year. It said that that the share of bad loans to total loans would improve after touching a high of 11.1% in fiscal year march 2015. Finally, the BSE Sensex gained 31.44 points or 0.12% to 26590.59, while the CNX Nifty added 9.90 points or 0.12% to 8060.70.