Markets likely to get a flat-to-positive start

The Indian markets despite a volatile trade managed to snap the last session’s trade with gain of over half a percent. IT bellwether TCS single handedly drove the markets higher. Today, is the penultimate day of the April F&O series expiry and the trade is likely to remain volatile, though the start may be positive amid optimistic global setup. After TCS, today is the day for another IT major Wipro, which announced its numbers, the company’s consolidated net sales increased by 19% for the Q4 and 21% for the fiscal. While the net profit increased by 8% for the quarter and 5% for the year. The numbers are slightly below the expectations and may put pressure on the stock and the sector as on whole. Traders will also be eyeing the movement of rupee which has hit a three-and-half month low against the dollar. The domestic currency has been continuously declining on sustained demand for the dollar and lacking any intervention by the Reserve bank of India (RBI). It is being said that RBI may intervene should the rupee touch the 53 mark. The OMC’s may remain in good mood with the report that government has agreed to make the diesel prices market determined. High oil prices have caused subsidy burden to swell up to 2.5 per cent of GDP.

Apart from this there will be lots of result announcements to keep the markets buzzing. Alfa Laval, BASF India, India Cements, HCL Infosystems, Nestle India, Sterlite Inds, Swaraj Engines, Yes Bank etc. are the majors to announce their earnings today.

The US markets bounced back on Tuesday supported by strong earnings from big manufacturers and AT&T, however finally the major indices ended mixed as Nasdaq closed in red weighed down by the weak performance of Apple. Also the consumer confidence came in slightly below expectations but new home sales and the Case-Shiller home price index showed slow but continuing improvement in the housing market. The Asian markets have made a mixed start with some indices that remained under pressure in last session showing sign of recovery, Japanese markets was up by about a percent as the yen fell after US corporate profits beat estimates. South Korea’s Kospi index too was up by about half a percent as country's consumer confidence rose to an 11-month high.

Back home, the Indian markets reversed their last session’s trade and showed smart recovery after initial hiccups to convalesce around half of their previous day’s losses. Though, volatility crept in the latter part of the trade but riding on the jubilation of the IT bellwether TCS, markets managed to sail comfortably and ended near the high points of the day. Earlier, the benchmarks made a flat but positive start, the lower ending of the US markets and the mixed start of the Asian markets weighed on the sentiments. Trade took a choppy turn and in the initial hours the markets lost momentum to trade in red. Later, slow but steady recovery took the markets higher and by noon the benchmarks were trading near the high points of the day with Sensex crossing 17,200 mark and Nifty breaching 5,200 levels. Meanwhile, it was IT pack that mainly propelled the markets of which IT major TCS played the major role, surging by over 12% on reporting better than expected numbers. The company’s profit was up by 19% for the quarter, while the full year standalone profit surged by 45%. The numbers encouraged the other majors of the sector and Wipro surged by over 4%, while HCL Technology gained over 4%, even the other major Infosys that has been lagging in last session on disclosing that the company was under scrutiny from US regulating authorities for likely errors in employer eligibility documents of its staff, too moved up by over a percent. The oil marketing companies (OMCs) rejoiced in the latter part of the trade on report that the government has agreed in-principle to deregulate diesel prices. However, it said that it is not considering similar proposal for the cooking gas. However, all the sectors were not lucky and the market participants went for selective value picking, Capital Goods (CG) sector turned out to be the laggard of the day, losing over one percent as barring few, most of the sector heavy weights declined heavily. Larsen and Toubro despite bagging construction contract worth Rs 500 crore from M3M India lost about 3%. On the same time, the telecom stocks continued their pounding after Telecom Regulatory Authority of India (TRAI) on Monday proposed a reserve price of Rs 3,622 crore for the auction of 1MHz of pan-India 2G spectrum in the 1800 megahertz band, almost 10 times as compared to Rs 380 crore in the 2008 sale. Finally, the BSE Sensex gained 110.61 points or 0.65% to settle at 17,207.29, while the S&P CNX Nifty rose by 22.05 points or 0.42% to close at 5,222.65.