Markets to get a cautious but positive start

The Indian markets continued the rally mood supported by the unprecedented surge in market heavyweight Reliance Industries, though the major bourses came off their intraday highs but managed decent gains in last session. Today, the start of the F&O series expiry session is likely to be in green, though there will be some cautiousness too with US Fed minutes stating that it might be appropriate to raise interest rates again fairly soon if incoming data on the labor market and inflation is in line. Also, the International Monetary Fund (IMF) has said that India’s growth is projected to slow to 6.6 percent in 2016-17 fiscal due to the strains that have emerged in the economy as a result of 'temporary disruptions' caused by demonetization. There will be some buzz in the banking stocks, as the Chief Economic Advisor (CEA) Arvind Subramanian has emphasised the need to move full steam to deal with the problem of bad loans facing banking sector. He said that the government is considering setting up a state-owned asset reconstruction company to deal with mounting bad loans. Oil & gas sector too will be in focus, as the CEA has said that rising global oil prices will not pose a serious risk to the economy if they remain within the range of $55-65 a barrel.

The US markets consolidated a bit and made a mixed closing in the last session following the release of the minutes of the Federal Reserve's latest monetary policy meeting, though the Dow still managed to climb to another new record closing high. The Asian markets have made a mixed start like the US counterparts, after minutes from the Federal Reserve’s latest meeting were deemed dovish. The Japanese market was in red as the yen strengthened.

Back home, Indian benchmark indices edged higher for the fifth consecutive session on Wednesday on account of short-covering by investors ahead of February month F&O expiry on Thursday. Besides, Index heavyweight Reliance Industries, which helped the markets to remain in green till last, made its presence felt by surging around eleven percent in the session, as investors cheered the company's move to end free telecom services on its Jio platform and start charging customers from April 1. Jio is seeking to retain customers through special prime memberships at a one-time fee of Rs 99 and Rs 303 a month for unlimited voice, data and content. Furthermore, the country's third largest private sector lender, Axis bank, gained as much as 3.9 percent, after the report that the government has no plan as of now to exit Axis Bank via SUUTI. Sentiments got some support with a private report stating that India's millennial population is a massive disruptive force and driven by this supportive demographics along with government's policy action, Indian economy is likely to reach $ 5 trillion by 2025.  Market participants got some comfort as Prime Minister Narendra Modi urged the United States to keep an open mind on admitting skilled Indian workers, in comments that pushed back against Republican President Donald Trump's 'America First' rhetoric on jobs. Moreover, India is likely to pitch for a global agreement to make it easier to travel for work across borders at international fora like the G-20 and BRICS as increasing protectionism in the West has unsettled the country's services industry, which accounts for about 60% in the country's GDP and 28% of total employment. Finally, the BSE Sensex surged 103.12 points or 0.36% to 28864.71, while the CNX Nifty was up by 19.05 points or 0.21% to 8,926.90.