The Indian markets snapping their winning streak had ended lower in the last session, with traders turning cautious ahead of key macro data. Today, the start of the new week is likely to be in green, though the regional peers are showing mixed trend, Indian markets will be getting encouragement with the consumer price index (CPI) inflation easing to 2.99 per cent in the first month of the new financial year compared with 3.89 per cent in March and 5.47 per cent in the year earlier. Also, the inflation based on the wholesale price index (WPI) slipped to a four-month low of 3.85 percent in April as both food articles and manufactured items showed cooling in prices. However, there will be some cautiousness too, with industrial output growth slipping to 2.7 percent in March compared to 5.5 percent in March 2016, mainly on account of poor performance of manufacturing sector. Meanwhile, India Inc has invoked the demand supply dynamics, calling for lower interest rates for private investment to pick up that will help the government achieve full benefit of cash ban. There will be buzz in the power sector, as India has climbed up to twenty sixth position in World Bank's electricity accessibility ranking in the current year from 99th spot in 2014. There will be lots of important earnings announcements to keep the markets buzzing.
The US markets despite coming off their early weakness made a mixed closing in last session, snapping the lackluster week on mostly a negative note, after a weaker than expected retail sales data. The Asian markets have made a mixed start and some of the indices are down by over a quarter percent led by the Japanese market. The Chinese market which started in green, too has pared some of the gains, as data showed China's industrial production slowed, adding to concerns over the strength of the global economy.
Back home, Indian markets finished last trading session of the week on a pessimistic note, as investors remained cautious ahead of macroeconomic data - industrial production numbers for March and inflation data for April based on Consumer Price Index (CPI) - to be announced later in the day. CPI is expected to have eased to a three-month low of 3.49% in April from 3.81% the previous month. The government will release the new series of Index of Industrial Production (IIP) as well as Wholesale Price Index (WPI), with 2011-12 as the base year, so as to map economic activities more accurately. Also, there was some profit taking in the high fliers of the recent rally that once led Sensex slip below the crucial level of 30,200, but despite the rallies losing fizz, downside remains capped with SBI Research's Ecowrap report, indicating that the easing of crude oil prices will have positive effect not only on inflation but also on GDP growth. It said that average crude oil prices will be around $45 for the next half of this year and this, coupled with positive macro fundamentals, could translate into better growth numbers for the country. Some support also came with Finance Secretary Ashok Lavasa’s statement that India can clock a GDP growth of over 7.5 percent in the fiscal 2017-18 and the country's macro-economic fundamentals, including fiscal deficit and inflation, are all very sound. Lavasa also said that while there has been a general climate of economic slowdown in the last few years across the world, India has managed to maintain a healthy rate of growth. In scrip specific development, the top loser in Nifty was Yes Bank, which came under selling pressure after the bank disclosed that it had reported lower non-performing assets (NPAs) than what was judged by the banking regulator for the year ended March 31, 2016. According to its annual report, the bank had reported gross NPAs worth Rs 748.9 crore as on March 31, 2016, while the RBI, as part of its annual supervisory action, had asked the lender to report gross NPAs worth Rs 4,925.6 crore. Finally, the BSE Sensex decreased 62.83 points or 0.21% to 30188.15, while the CNX Nifty was down by 21.50 points or 0.23% to 9,400.90.
