Markets likely to make slightly positive opening

Indian shares ended a lackluster session on a flat note on Friday, as fears of a global trade war persisted and investors exercised some caution after strong gains in the previous session. Today, the markets are likely to make flat-to-positive opening amid mixed global cues. The traders’ focus now turns to quarterly earnings this week, with IT major Infosys likely to declare its March quarter results on April 13. On the macro economic front, the government will unveil industrial output figures for February and retail inflation data for March on April 12. Traders will remain little cautious on report that inflows into Indian equity funds in March were the smallest in 13 months as some investors sold before a tax on stock holdings took effect from April 1 and volatility returned to markets worldwide. Equity funds took in a net Rs 66.57 billion ($1 billion), the least since last February. Meanwhile, Economic Affairs Secretary Subhash Chandra Garg said India will have to create and nurture a very healthy and supportive macroeconomic environment to become $10 trillion economy by 2030. He added that government has taken many reform measures since 2014, including GST (Goods and Service Tax) and IBC (Insolvency and Bankruptcy Code). Metal stocks related to steel and aluminium will be buzzing in today’s trade, as India will take up the issue of duty hike on certain steel and aluminium products by the US at the Trade Policy Forum (TPF) meeting on April 10. Tobacco stocks will remain in focus on report that the commerce and industry ministry has convened a meeting on April 11 of all stakeholders, including farmer associations, private companies and government departments to deliberate upon issues pertaining to foreign direct investment (FDI) in the tobacco sector.

The US markets closed sharply lower on Friday amid renewed trade war concerns after President Donald Trump threatened to impose $100 billion of additional tariffs on Chinese imports. Asian stocks are trading higher on Monday as a bounce in US stock futures soothed sentiment even as US President Donald Trump kept up his twitter war with China over trade just a couple of days before President Xi Jinping gives a keynote speech.

Back home, Friday turned out to be a volatile day of trade for Indian equity benchmarks where key gauges somehow managed to keep their head above water and went home with marginal gains. Markets made a cautious start and traded mostly in red after US President Donald Trump ordered his administration to consider tariffs on a $100 billion worth of Chinese imports, dashing hopes for a cooling of trade tensions. The traders also reacted negatively to the report highlighting that 23,000 high net worth individuals (HNIs) have left India since 2014 including 7,000 in 2017 alone, highest numbers for any country. Sentiments remained down-beat after CARE Ratings in its latest report stated that even though RBI lowered its inflation projection sharply from previous forecasts in its first monetary policy review for the new financial year, two key factors -- the progress and spread of monsoons along with the MSP fixation by the government would be a key determinant for inflation in the coming months. Buying in last leg of trade helped markets to pare all of their early losses and end the session slightly in green terrain as traders get some solace after the finance ministry welcomed the Monetary Policy Committee’s (MPC) projection of higher GDP growth and lower inflation in the current fiscal. The MPC’s growth projection of 7.4% is in line with the Economic Survey. MPC has projected inflation at 4.5% in the fourth quarter of the last fiscal. The decision of MPC comes against the backdrop of government’s assertion that both the fiscal deficit as well as the revenue shortfall in 2017-18 will be lower than the upwardly revised estimates given in the Union Budget. Sentiments also got some support with private report that Indian services sector climbed back into expansion zone in March, helped by the flow of new work, encouraging companies to hire at the fastest pace in seven years. Finally, the BSE Sensex gained 30.17 points or 0.09% to 33,626.97, while the CNX Nifty was up by 6.45 points or 0.06% to 10,331.60.