Markets to make a cautious start of the new series

The Indian markets showed splendid performance in last session, posting humongous gains and snapping the November series on an upbeat note. Today, the start of the new series is likely to be a bit cautious and markets will be consolidating after the big gains, lacking any supportive cues. All eyes will be on political developments now, though the real business of the winter session of the parliament will start from Monday but government is making all efforts for the passage of crucial bills and the Finance Minister Arun Jaitley has said that Prime Minister Narendra Modi is willing to speak to everyone to get the landmark Goods and Services Tax (GST) bill through. Government is hopeful of passage of the GST bill in the winter session of parliament claiming 30 of the 32 parties have supported it. The aviation stocks will be in action, as the Reserve Bank of India, relaxing the norms for aircraft and helicopter imports has said that banks can allow advance remittances for imports once the company has approval from aviation regulator DGCA. Also, global airlines grouping International Air Transport Association has forecasted that India is likely to become the third largest aviation market in the world displacing the UK by 2026. On the other hand, some somberness can be seen in the banking stocks, as the RBI in its report has stated that the deposit and credit growth of commercial banks declined to 10.2% and 8.9% in the September quarter of this fiscal.

The US markets remained closed in last session unable to give any clues to the other global markets, while the European markets ended in green on stimulus hopes. The Asian markets though have made mostly a lower start with mixed data out of Japan, as the household spending for October slumped, while the closely watched national core consumer prices fell the expected 0.1% year-on-year for October.

Back home, boisterous benchmarks showcased an enthusiastic performance on November F&O series expiry session, by rallying over half a percentage point. Sentiments remained up-beat since start as key bourses made a positive opening and there appeared not even an iota of profit booking in the session as the benchmarks managed to fervently gain from strength to strength as investors continued hunt for fundamentally strong stocks. Frontline indices not only ended the session near intraday high levels but also hit their highest level in over two weeks, recapturing their crucial 7,850 (Nifty) and 25,950 (Sensex) bastions as investors took to hefty across the board buying.  Traders remained hopeful for a breakthrough on GST bill in Parliament, after appealing to the Opposition for cooperation on the eve of the winter session of Parliament, Prime Minister Narendra Modi made a strong pitch for early passage of the GST, saying it will be in the interest of the nation. Finance Minister Arun Jaitley too said that he has spoken to Congress leaders on the GST bill to break a deadlock in Parliament and is optimistic that the key reform measure will be passed in the winter session. Some strength came after Moody’s said that most Indian companies under its rating scanner would benefit from strong domestic growth and accommodative monetary policy in 2016. Some support also came with the report that India's crude oil import bill is likely to dip by 35 per cent to $73 billion this fiscal as global energy prices slumped on weak demand. Markets extended their gains as European counters, after a mixed start, turned positive, while Asian markets ended mostly in green. Back home, there was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too participated strongly in the rally. Buying in metal counters too aided sentiments as copper prices rose in global commodity markets. Stocks related to Oil & gas sector too remained on buyers’ radar after the Power Minister Piyush Goyal said that the Government will approach global markets for long term gas supply pacts in view of low prices of the fuel. Finally, the BSE Sensex surged by 182.89 points or 0.71% to 25958.63, while the CNX Nifty gained 52.20 points or 0.67% to 7883.80.