Markets to get a strong start of the data heavy week

The Indian markets remained in consolidation mood in the last session and the major averages lost about a quarter percent after trading mostly in a range. Today, the start of the data heavy week is likely to be in green on jubilant lead from the global markets, though traders apart from the IIP and inflation data later in the week will be eyeing quarterly earnings from blue-chips TCS and Infosys for cues. Traders will be getting some support with NITI Aayog Vice Chairman Arvind Panagariya’s statement that the government has put the economy on the path of reform to achieve a high growth trajectory though there are significant lags between policy decisions and outcomes which need to be addressed. He also said that today, the economy is far healthier compared to the last year of UPA II in all macroeconomic parameters. However, there will be some concern as well, with the recently-concluded meeting of G20 trade ministers ahead of the big summit later this year stating that investments, globally, are likely to fall 15 per cent in the coming year and there was a need for the G20 to show its leadership. There will be buzz in the chemical stocks, as the government has imposed anti-dumping duty on imports of chemicals from five countries, including China and Iran, to protect domestic manufacturers. The imports of the chemical from the five countries (China, Iran, Indonesia, Malaysia and Taiwan) will attract anti-dumping duty in the range of $ 83.08 per tonne to $ 168.76 per tone. The earnings season kicks off with IndusInd Bank set to announce its June quarter results today.

The US markets surged in last session on getting a better than expected jobs data that damped concern the world’s biggest economy is losing momentum. The Asian markets have made a strong start taking cues from the upbeat US markets and many of the indices are trading up by over a percent, while the Japanese markets has taken the lead and was higher by over three percent after Prime Minister Shinzo Abe’s ruling coalition won an election and the yen fell for the first time in a week.

Back home, Indian benchmark indices finished the week on a sluggish note as the major bourses showcased an unenthusiastic performance on Friday and settled with modes cuts of around a quarter percent.  Sentiments largely remained pessimistic in the local markets with a steady stream of negative news this week in the form of rising Brexit uncertainty and a growing crisis in Italian banks. Further, investors turned jittery after a global financial service major stated that India’s economy may grow at a slightly slower pace of 7.4% this fiscal amid weaker global demand and risk aversion, flagging methodological concerns in computation of official GDP data. However, the downside for the markets was capped with Economic Affairs Secretary Shaktikanta Das’ statement that the Finance Ministry is hoping that the prices of pulses will now be contained and help keep inflation under check due to the higher minimum support price for pulses. Also the government has decided to introduce the GST Bill on the first working day of the monsoon session of Parliament, in what could be a sign of its confidence that it can notch up the numbers for the long-pending legislation. Meanwhile, shares of print media companies gained on reports that the government is planning to raise the foreign direct investment limit in newspapers and periodicals to 49% from 26% at present. On the other hand, Telecom stocks declined after reports suggested that the telecom department is likely to soon send out demand notices to some carriers for under reporting of revenues. Further, stocks of companies involved in oil exploration & production activities came under pressure as global crude oil prices dropped. On the global front, Asian markets ended lower on Friday, while the European stock markets were mostly higher in early trade. Back home, after getting cautious start, the local benchmark indices soon drifted to lowest levels in the session as investors were largely influenced by the daunting sentiments prevailing in Asian markets. However, the psychological 8,300 and 27,100 levels proved as strong support levels for the key gauges as the benchmarks soon recovered from the lows and oscillated in a narrow band but failed to claw back into the green by the end. Finally, the BSE Sensex ended lower by 74.59 points or 0.27% to 27126.90, while the CNX Nifty dropped 14.70 points or 0.18% to 8,323.20.