Markets to make positive start on firm global cues

Indian markets ended in red on Monday as mixed U.S. jobs data helped ease fears of faster rate hikes by the Federal Reserve. Today, the markets are likely to make an optimistic start tracking firm global cues. Traders will react on private report stating that the government is considering setting a time limit for withdrawing cases admitted for insolvency resolution, ending ambiguity on a key aspect of the procedure. Companies referred to bankruptcy courts may not be allowed to leave the process once bids have been invited or a resolution plan has been accepted. Meanwhile, the Prime Minister’s Office (PMO) was justified in denying information pertaining to the printing of currency notes post demonetisation citing exemption clauses related to national and economic security in the RTI Act. There will be buzz in telecom related stocks after Telecom Regulatory Authority of India (Trai) issued 26 orders imposing fines of over Rs 2.81 crore for unsolicited commercial calls and pesky messages last year. Power stocks will remain in focus after World Bank said, India is doing extremely well on the electrification front and about 30 million people received electricity between 2010 and 2016, which is much more than any other country in the world. There will be some important earnings announcements too, to keep the markets buzzing.

The US markets ended higher on Monday as upward momentum seen last Friday in response to the Labor Department’s monthly jobs report. Asian markets are trading mostly in green on Tuesday, following the firmer lead from Wall Street. The Japanese stock market recovered after a weak start and is modestly higher, with exporters mostly higher despite a stronger yen.

Back home, Monday turned out to be a remarkable day of trade for Indian equity benchmarks where bulls made come back on Dalal Street, with frontline gauges recapturing their crucial 35,200 (Sensex) and 10,700 (Nifty) levels. 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. Markets started the session on an optimistic note as traders took encouragement with ADB Chief Economist Yasuyuki Sawada’s statement that India’s projected GDP growth of over 7% for the current fiscal is amazingly fast and if this momentum is maintained the size of the economy can double within a decade. He also said that the country shouldn’t worry about not achieving 8% growth but focus on increasing domestic demand by reducing the income inequality. Some support also came with Commerce and Industry Minister Suresh Prabhu’s statement that the government is working on a strategy to promote services exports which have the potential to boost overall foreign shipments and economic growth. Markets extended rally in second half of trade on report highlighting that with the GST collection in April crossing the Rs 1-trillion-mark, the FY19 target of Rs 12.9 trillion mop-up seems feasible. It added that going forward, with government introducing anti- evasion measures like TDS, TCS and credit matching, these could be hopeful of very good GST collection for FY19. Investors shrugged off a report that foreign investors have pulled out over Rs 15,500 crore from the Indian capital market in April, making it the steepest outflow in 16 months, due to surge in global crude prices and rise in yields of government securities here. This comes after an inflow of Rs 11,654 crore in equities in March and an outflow of over Rs 9,000 crore from the debt market during the same period. Finally, the BSE Sensex surged 292.76 points or 0.84% to 35,208.14, while the CNX Nifty was up by 97.25 points or 0.92% to 10,715.50.