The Indian markets had rallied before going for a long weekend with major indices posting gains of near to two percent on hopes of good monsoon. Today, the start of another truncated week is likely to be soft, tailing the weakness in the other global markets. Traders will also be concerned with a quarterly employment survey report of Labour Bureau, a wing of Labour Ministry, which has said that employment generation in eight key sectors, including gems & jewellery, handloom, leather and automobiles, was at seven-year low of 1,35,000 jobs in 2015. Moreover, the October-December quarter of 2015 saw job losses of 20,000 in eight key sectors compared to previous quarter. Also, the International Monetary Fund (IMF) in its latest edition of the World Economic Outlook (WEO) has warned that while several demand and supply-side factors have resulted in a sharp fall in inflation and have given the Reserve Bank of India space to cut interest rates, there are several factors that could drive inflation up again. The IT stocks will be in action after Infosys reported a stellar Q4 numbers during the weekend, the company’s full-year revenue growth came in at 9.1% in actual currency terms and it gave a bold guidance of 11.8-13.8% for the 2016-17 financial year. Today, the largest IT company of the country TCS will be announcing its numbers. The FMCG stocks too may be buzzing with a private survey showing that household consumption of fast-moving consumer goods in rural areas grew at almost double the pace of urban areas in 2015.
The US markets ended marginally in red in last session weighed down by energy stocks, though Dow managed to post its largest weekly gain in a month with Chicago Fed President Charles Evans stating that investors should expect only modest increases in interest rates this year. The Asian markets have made mostly a weak start on slump in crude prices after major oil producers failed to reach an agreement to curtail production in Doha over the weekend.
Back home, the local equity markets rallied for the third day in a row on Wednesday, as data showing easing inflation and forecast for an above-average monsoon rains sparked hopes for the economic growth and for more rate cuts by the Reserve Bank of India. Besides, strength among the global peers amid rally in commodity and crude oil prices on reports of Russia-Saudi Arabia agreement to freeze output, further buoyed sentiment. On the macroeconomic front, India’s industrial production expanded at 2% year-on-year in February after staying negative for the last three months on better performance of mining, power and consumer goods, while retail inflation in March fell to a six-month low of 4.83% on account of cheaper food articles such as vegetables and pulses. On the global front, all the major Asian equity indices finished in the positive terrain, European markets too mirrored the sanguine Asian cues. Back home, the benchmark got off to a rollicking opening as investors rejoiced an above normal monsoon forecast after two straight years of drought, while easing inflation and rebound in industrial output also boosted sentiment. The frontline indices soon gathered momentum and traded with over a percent gains through the morning session of trade. Second half of the session saw the key gauges capitalize on the momentum further and spurt to session’s highest levels in dying hour. However, a mild profit booking in dying moments of trade ensured that the key indices shut shops off the intraday highs. Finally, the BSE Sensex surged 481.16 points or 1.91% to 25626.75, while the CNX Nifty rallied 141.50 points or 1.84% to 7,850.45. Indian markets remained closed on Thursday and Friday for local holidays.
