Markets likely to make a green start on positive cues

The Indian markets made a positive start of the new financial year and despite some volatility managed a close with gain of around half a percent. Today, the start is likely to be in green on supportive global cues, though the investors will be mainly eyeing the RBI’s action in its quarterly policy review next week. There is likely to be buzz in the markets with SEBI’s nod to listing of stock exchanges. Sebi has said that a Stock Exchange (SE) may list on another bourse but not on itself, and only 'after they put in place the appropriate mechanisms for tackling conflicts of interest'. Sebi also said SEs will be allowed to list only after three years from the date of approval by the regulator. It also allowed a depository to list, but not a clearing corporation. Some specified alternate investment funds (AIFs) such as private equity funds and venture capital funds too have been allowed to list on the bourses with some riders.  Meanwhile, the oil marketing companies are likely to continue bleeding, lacking any clarification from the government, they have warned of disruptions in fuel supplies if they are not allowed to raise petrol price or compensated for the Rs 48 crore per day loss they incur on selling fuel below cost.

The US markets extended their jubilation on the first trading day of the new quarter supported by domestic manufacturing data that continued to improve last month. The Institute for Supply Management's manufacturing index rose to 53.4 last month from 52.4 in February. However, construction spending fell 1.1% in February but traders concentrated on positive news and took the markets higher. The Asian markets are trading mixed in the early trade, though some indices have recovered with the news of better than expected US manufacturing data and gain in China’s service sector but the Japanese market was still in red dragged by the exporters, as the yen surged to a three-week high against the dollar.

Back home, after snapping the last quarter of FY 2011-12 with over twelve percent gains, stock markets in India have started the FY 2013 on an optimistic note thanks to the supportive global as well as local tidings. Sentiments on street got boosted with the largely positive leads from markets across Asia which gained on the back of surprisingly upbeat Chinese manufacturing data, which gained momentum for a fourth straight month to reach 11 month high levels in March alleviating worries over the world’s second largest economy’s hard landing. The key domestic gauges gained some ground after breaching the psychological 17,450 (Sensex) and 5,300 (Nifty) levels as investors showed largely across the board buying interests. However, the going got tad turbulent in the second half tracking the European markets which got off to a positive opening but failed to capitalize on the momentum because of the Euro-zone manufacturing PMI numbers which were bit disappointing and weighed on investors’ morale. Nevertheless, the domestic frontline equity gyrating in a tight range on the first trading session of the holiday truncated week snapped second straight session in the green terrain with close to half a percent gains. The rate sensitive counters like Bankex and Realty surged over a percent in the session as investors at large have now shifted their focus towards the RBI's quarterly monetary policy review meet scheduled in April, hoping that the central bank would employ some liquidity easing measures to stimulate economic growth. Besides, most automobile companies traded on a positive note after reporting pretty strong sales numbers for the month as well as for the financial year. Furthermore, the power sector stocks rallied with fervor amid reports that Tamil Nadu Electricity Regulatory Commission approved a steep 37% hike in power tariff for one year, effective from April 1. Meanwhile, investors shrugged off the weak manufacturing PMI numbers for March which showed the expansion of India's factory sector slowed for the third month as growth in new orders eased and costs for raw materials kept rising. On the other hand, investors were seen booking some profits in sectors like Oil & Gas, Metal and defensive Healthcare. Finally, the BSE Sensex gained 73.95 points or 0.42% to settle at 17,478.15, while the S&P CNX Nifty rose by 22.35 points or 0.42% to close at 5,317.90.