Markets to extend gains with a positive start

The Indian markets bounced back in the last session on firm global cues and slump in oil prices, which cooled some worries of rising fiscal deficit. Today, the start is likely to be in green on supportive global cues and the bourses will extend gains with bargain hunting continuing for yet another day. Meanwhile, the finance ministry has said that the FRDI Bill, under consideration of a joint parliamentary committee, is depositor friendly and provides more protection to them compared to existing provisions. It has clarified that The provisions in the FRDI Bill do not modify current protections for depositors adversely at all, the ministry held, maintaining that these rather provide additional protections in a more transparent manner. Traders will be getting some encouragement with International Energy Agency's (IEA) report that India is emerging as a "major driving force" in global energy trends, with all modern fuels and technologies playing a part. The power sector will also be buzzing, as Minister of State (Independent Charge) for Power and Renewable Energy, RK Singh, has coaxed State governments to reduce the number of slabs for selling power.

The US markets managed a positive close though the major averages came off their highs in last session. The early gains were on optimism about lawmakers passing a short-term spending bill to avoid a government shutdown. However, traders continued to express some uncertainty about the details of the final Republican tax reform bill. The Asian markets have made a green start, led by the Japanese market which is up by over a percent, as its economy expanded in the third quarter more than initially reported, as business investment grew at a faster pace.  Traders in the region were jubilant with the U.S. tax reform bill making an encouraging progress.

Back home, Bulls made comeback on Dalal Street on Thursday with frontline gauges garnering gains of over a percentage point, recapturing their crucial 32,900 (Sensex) and 10,150 (Nifty) bastions, as traders opted to buy beaten down but fundamentally strong stocks after two days of continuous drubbing. The markets' mood remained up-beat throughout the day and benchmarks fervently gained from strength to strength with traders taking encouragement with former Reserve Bank of India Governor YV Reddy's statement that amid uncertainties in the global economic order, a sense of optimism about the future is more in India than in other parts of the world. Meanwhile, at a meeting with Finance Minister Arun Jaitley in the run-up to the last full-year Budget of the NDA government before 2019 general elections, India Inc. has sought lower tax and more incentives for investments while exporters called for quicker GST refunds. Some support also come with International Energy Agency's (IEA) latest report stating that India is among bright spots in the global economy and is emerging as a major driving force in global energy trends, with all modern fuels and technologies playing a part. Markets extended rally in second half of trade to end near intraday highs on report that the share of foreign portfolio investments (FPI) in domestic capital markets through participatory notes (P-notes) surged to Rs 1.31 lakh crore at the end of October, after hitting an over eight- year low in the month of September. Total value of P-note investments in Indian markets including equity, debt and derivatives, at October-end climbed to Rs 131,006 crore, from Rs 122,684 crore at the end of September. Separately, a foreign brokerage report enlightened that the country’s economic growth is expected to continue with a shallow recovery next year, and is likely to inch up to 7.2% in 2018-19 from an estimated 6.5% in the current fiscal. The report added that economic recovery will continue to be driven by consumption, supported by a pre-poll step up in public spend rather than investment, given the persistence of surplus capacity and tight 3.2% of GDP fiscal deficit target. Finally, the BSE Sensex soared 352.03 points or 1.08% to 32,949.21, while the CNX Nifty was up by 122.60 points or 1.22% to 10,166.70.