Markets to open slightly in green; TCS result eyed

Indian markets extended their gains for fourth straight session and ended higher on Wednesday tracking strength in global peers on rising hopes that the US and China would strike a deal to end their trade tiff. Today, the start is likely to be marginally in green amid positive trade on Wall Street. Traders will be looking for third-quarter corporate earnings for the financial year 2018-2019, with Tata Consultancy services (TCS) reporting quarterly results today. The company is expected to continue to deliver healthy earnings in October-December quarter though furloughs could impact some growth. Traders will be getting encouragement with PwC-Ficci survey showing that India Inc expects over seven percent growth in the next 12 months on the back of a number of policy initiatives taken by the government. As per the report, The Indian economy is likely to grow at an average rate of 7% or more in the coming year. It added that India Inc is upbeat about the future of the economy as growth is to be driven by strong domestic demand and an increased focus on export markets. Also, there will be some support with Finance Minister Arun Jaitley’s statement that the government’s electric mobility programme will promote manufacturing and job creation, besides reducing pollution. Besides, a private report stated that India is likely to become the world’s second-largest economy by 2030, next only to China and overtaking the US. Traders may take note of a report that NITI Aayog Vice Chairman Rajiv Kumar made a case for adopting a middle path with regard to data protection, saying data nationalism may be the anti-thesis of global growth. Meanwhile, Commerce minister Suresh Prabhu urged the finance ministry to make the process of refund of GST input tax credit online. However, there may be some cautiousness in the markets amid weak Asian peers as the markets awaited more clarity on US-China trade talks that raised hopes of a deal to avert an all-out trade war. 

The US markets ended higher for fourth straight session on Wednesday after the minutes of the latest Federal Reserve meeting confirmed Fed Chairman Jerome Powell's recent remarks suggesting the central bank will take a patient approach to further interest rate increases. Asian markets were trading mostly in red on Thursday after Chinese inflation data came in below expectations.

Back home, last hour rally helped Indian equity benchmarks to close Wednesday’s trading session with strong gains. After a firm start, the key indices remained upbeat for the most part of the session, as the World Bank forecasted that Indian economy is expected to grow at 7.3% in the current fiscal year 2018-19 (FY19) and will grow further at average 7.5% in the following two years. It also said that India registered quite a bit of pick up in doing business ranking. Adding some optimism, the finance ministry said that the recovery of evaded indirect taxes shot up in 2018-19, after a low in 2017-18, the year when the goods and services tax (GST) was implemented. Recovery as a percentage of the evaded taxes dropped from 26% in 2016-17 to 14% in 2017-18. Then, it went up to 29% in 2018-19 (April to December period). Some support also came with a report stating that the central government has released Rs 48,202 crore as GST compensation to states during April-November 2018, higher than the Rs 48,178 crore paid in the previous financial year. However, in last hour of trade markets witnessed volatility with key gauges reversing all of their gains to enter into red terrain for brief period of time, as sentiments got hurt with a private reports stating that the battered Indian rupee will take another bruising this year, despite a recent revival, weighed down by uncertainty around national elections in May and an expected economic slowdown.  Some anxiety came on the street, with the World Bank’s report showing that the growth of the global economy is expected to slow to 2.9 percent in 2019 compared with 3 percent in 2018, citing elevated trade tensions and international trade moderation. But soon, the markets regained momentum to end the session near day’s high points, tracking firm European markets. The rally also buoyed with the World Economic Forum report stating that India is poised to become the third-largest consumer market behind only the US and China; and consumer spending in India is expected to grow from $1.5 trillion at present to nearly $6 trillion by 2030. Finally, the BSE Sensex gained 231.98 points or 0.64% to 36,212.91, while the CNX Nifty was up by 53.00 points or 0.49% to 10,855.15.