Markets to get a positive start of the new week on sanguine global cues

The Indian markets coming out of the consolidation mood surged in the last session and the major bourses touched their fresh record highs. Today, the start is likely to be in green on positive global cues, though traders will be concerned with the Central Statistics Office (CSO) first advance estimates of GDP growth for current financial year, stating that the Indian economy is expected to grow at a slower 6.5 percent in 2017-18 compared to the 7.1 percent in 2016-17. According to CSO, the Gross Domestic Product (GDP) at constant (2011-12) prices for 2017-18 is likely to attain a level of Rs 129.85 lakh crore. However, there will be some support with report that credit growth after a long gap grew in double digits to 10.65 per cent at Rs 80,96,727 crore in the fortnight ended December 22, 2017 due to the base effect. Meanwhile, credit rating agency ICRA’s statement that the narrower-than-expected win in Gujarat and upcoming polls in other states will lead to a reorientation of priorities for the government with a greater focus expected on the farm and small businesses sectors. It has said that government may opt for fiscal deficit range in Budget. There will be some buzz in the aviation stocks, as the government has if capping of airfares get implemented it would result in increased cost of air travel for 99 per cent of the passengers.

The US markets made a positive closing in the last session, shrugging off the disappointing batch of U.S. economic data, with major averages once again reaching new record closing highs. The Asian markets have made a green opening ahead of the start of the region’s earnings season this week, with investors betting that the outlook for economic growth and profits is strong enough to support record-high stock prices.

Back home, Friday turned out to be a remarkable day of trade for Indian equity benchmarks where bulls tightened their grip on Dalal Street, with Nifty and Sensex hitting fresh record highs and ending above their crucial 10,550 and 34,150 levels, respectively for the first time ever. The markets’ mood remained up-beat throughout the day and benchmarks fervently gained from strength to strength, as investors continued hunt for fundamentally strong stocks. Sentiments remained up-beat throughout the session with NITI Aayog’s expectation that the first strategic disinvestment of Central Public Sector Enterprises will be conducted within the current financial year. It said that the process of divestment is being carried out by Department of Investment and Public Asset Management (DIPAM) and the first transactions are expected in the current financial year after a long gap of 14 years. Some support also came with the Union Cabinet approving the revised model concession agreement for public private partnership projects in major ports. The amendments were made in the MCA to attract more investments in the port sector and are expected to clear the hurdles created by some of the provisions in the current model concession agreement. Some support also came with Finance Minister Arun Jaitley’s assurance that the positive impact of the government’s reform measures would get reflected in the medium to long term and noted that India is the only economy which could maintain a growth rate of 7-8 percent amid challenges like the country’s weak public sector banks (PSBs) and initial disturbance of demonetisation, Goods and Services Tax (GST). Meanwhile, traders’ focus shifts to third quarter earnings with Tata Consultancy Services (TCS) and Infosys scheduled to report their Q3 numbers next week, amid signs the economy is recovering after the withdrawal of high-denomination currency bills in late 2016 and the introduction of the GST last year. Finally, the BSE Sensex surged 184.21 points or 0.54% to 34,153.85, while the CNX Nifty was up by 54.05 points or 0.51% to 10,558.85.