Markets to get a soft-to-cautious start of F&O expiry week

The Indian markets gave up some of their gains in final hours of last session but managed to end in green. Today, the start of the F&O expiry week is likely to be flat-to-cautious on sluggish global cues and traders will be concerned over U.S. President Donald Trump's economic growth agenda. Traders will however be getting some support with the government’s plan to table four legislations for the implementation of the goods and services tax in the Lok Sabha today. The Union Cabinet has already cleared the four supplementary GST legislations - CGST, IGST, UTGST and Compensation Law - for introduction and passage in the ongoing session of Parliament. Also, the country is expecting 'bumper' crop of pulses this year but the supply will fall short of the demand. While, the logistics stocks will continue to remain in focus there will be scrip specific movement with market regulator Sebi barring Reliance Industries and 12 other entities from dealing in the futures & options segment for a year, directly or indirectly.

The US markets depicted another lackluster trade in last session after the US president Trump suffered a major blow when House Republicans withdrew the American Health Care Act after they failed to secure enough votes to pass the bill. The Asian markets have made mostly a lower start and some of the indices are trading lower by over half a percent in early deals, led by the Japanese market which is down by over one and half a percent after the yen strengthened against the dollar amid increased skepticism of U.S. President Donald Trump’s ability to implement his economic agenda after last week’s failed U.S. health-care deal.

Back home, Indian equity benchmarks carried forward their northbound journey for yet another session on Friday, as lenders such as SBI surged after Finance Minister Arun Jaitley promised a solution to the growing NPA problem within next few days. Jaitley also said the government is keen to roll out the GST on July 1 and other aspects like bringing petroleum and land under its ambit will be considered after the first year of implementation of the new system of indirect tax collection. Further, mutual fund managers seem to be bullish on bank shares as they raised their allocation in the sector to an all-time high of over Rs 1.2 lakh crore at the end of February, primarily on account of cheaper valuations. Meanwhile, some support also came with the report that EPFO trustees will meet on March 30 to discuss whether to increase its investments in ETFs to 15% of investible deposits in 2017-18, from the current 10%. Investors also got some comfort with External Affairs Minister Sushma Swaraj's statement that there was no reason to worry about the curbs on H1B visas or the job security of Indian IT professionals working in the US for the time being, as the Indian government was in talks with the US regarding this. Furthermore, strengthening of rupee against the dollar also supported the sentiments. However, gains remained capped on the report that the current account deficit (CAD) widened to $ 7.9 billion or 1.4% of GDP in the October-December quarter on account of higher trade deficit. Also, the Reserve Bank reported that the country added $ 14.2 billion in foreign exchange reserves on the balance of payment basis during the first nine months of the outgoing financial year, which is marginally down from $ 14.6 billion accretion in the year-ago period. Finally, the BSE Sensex surged 89.24 points or 0.30% to 29421.40, while the CNX Nifty was up by 21.70 points or 0.24% to 9,108.00.