Markets likely to get a flat but positive start

The Indian markets despite a choppy session managed a positive close in last session and the major indices notched their fresh record highs. Today, the start is likely to be mildly in green with traders taking some support with the World Bank projecting India's growth rate to 7.3 per cent in 2018 and 7.5 for the next two years.  It said that with an “ambitious government undertaking comprehensive reforms”, India has “enormous growth potential” compared to other emerging economies. The 2018 Global Economics Prospect released by the World Bank also said that India, despite initial setbacks from demonetisation and Goods and Services Tax (GST), is estimated to have grown at 6.7 per cent in 2017. Traders will also be eyeing the meeting organised by government think tank NITI Aayog, and attended by a host of ministers including Finance Minister Arun Jaitley, NITI Aayog functionaries and leading economists. Prime Minister Narendra Modi will interact with leading economists and sectoral experts to deliberate on economic policy roadmap for promoting growth and employment. There will be some concern in the oil companies as the international oil prices hit their highest levels since 2014. Telecom stocks too will be in focus as the Telecom Commission (TC) has decided to relax spectrum holding caps, giving a boost to M&As and spectrum sale.

The US markets ended at fresh record closing highs in the last session, though major averages were off their best levels of the day, with a lack of major U.S. economic data keeping some traders on the sidelines. The Asian markets have made a mixed start and some of the indices in the region are down by quarter to half a percent, taking a breather as investors consider the impact of a jump in bond yields. The Japanese market too was lower as the yen strengthened for a second day, after the Bank of Japan made a small cut to purchases of long-dated Japanese government bonds.

Back home, Extending winning streak for fourth straight day, Indian equity benchmarks once again settled at fresh record closing high levels, though gains remained minimal with traders turning cautious ahead of the corporate results season kicking in this week. Markets traded mostly in green during the day with traders taking some support from report that the Commerce and Industry Ministry is mulling incentives for States that play a proactive role in promoting exports as it will help boost economic growth. However, markets entered into red in noon deals with sentiments turning down-bear with report that Moody’s Investors Service and its Indian arm ICRA in a joint report have flagged anxiety about the growing delinquencies in the affordable housing segment, which are expected to continue in the calendar year 2018. Sentiments also remained dampened with the rating agency Crisil attributing the continuing slowdown to the after-effects of the demonetisation exercise, the Goods and Services Tax (GST) implementation and weakness in agriculture, rating agency, CRISIL in its latest report has maintained its projection of India's economic growth in 2018-19 to 7.6 percent on the low base.  Recovery in last leg of trade mainly helped markets to end at fresh record closing high levels with traders taking some solace with report that the government’s revenue collection continued its rising trend, mainly on account of income tax mop-up from individuals. India’s net direct tax collections, which are made up of personal and corporate taxes, rose to Rs 6.56 lakh crore during the April-December period of the financial year 2018. The collection indicates that 67% of the annual budget target of direct taxes (Rs 9.8 lakh crore) has been achieved. Finally, the BSE Sensex gained 90.40 points or 0.26% to 34,443.19, while the CNX Nifty was up by 13.40 points or 0.13% to 10,637.00.