Markets likely to open in green ahead of the Economic Survey

Indian markets ended choppy trading session tad higher on Wednesday as weak global data hurt sentiment, while investors awaited positive cues from the budget due later this week. Today, the start of session is likely to be in green tracking positive trend in global markets. All eyes will be on important event of the release of Economic Survey report which will be tabled in Parliament later in the day. The survey prepared by Chief Economic Adviser Krishnamurthy Subramanian is likely to flag headwinds that the economy might face in its pursuit to become the world's fifth largest economy. Traders will be getting some encouragement with commerce & industry minister Piyush Goyal’s statement that India will get additional $217 million of revenue from the retaliatory tariffs it imposed on 28 American products. With the retaliatory tariffs, maximum duty of $98.7 million will come from imports of almonds on which 17% additional duty is imposed followed by $24.5 million duty from 20% higher tax on diagnostic reagents. Some support will also come as the Union Cabinet approved the Code on Wages Bill which seeks to subsume existing laws related to workers remuneration and enable the Centre to fix minimum wages for the entire country. The Code on Wages is one of the four codes that would subsume 44 labour laws with certain amendments to improve the ease of doing business and attract investment for spurring growth. Meanwhile, the Reserve Bank has constituted a working group that will review the regulatory and supervisory framework for core investment companies. Besides, the tax department has extended by three months till July 31 the deadline for service providers with turnover of up to Rs 50 lakh to opt for the composition scheme and pay six per cent goods and services tax (GST). There will be some buzz in the agriculture stocks with the Union Cabinet giving its nod to hike the minimum support price (MSP) for kharif crops. MSP of paddy increased by Rs 65 per quintal, Jowar by Rs 120 per quintal and Ragi by Rs 253 per quintal. There will be some reaction in telecom stocks with report that telecom operators need to be financially sound to build up infrastructure and there is a need to review the auction architecture as they cannot pay high prices for spectrum.

The US markets ended in green on Wednesday as investor cheered the prospect of looser monetary policy at the world’s major central banks. Asian markets are treading mostly higher on Thursday amid further comments on Chinese and European currency manipulation by President Donald Trump.

Back home, Indian equity indices ended volatile session in green terrain on Wednesday, with Sensex and Nifty keeping their heads above crucial psychological levels of 39,800 and 11,900, respectively. Markets made a cautious start of day, as the finance minister stated that India's state-owned banks had classified Rs 1.50 trillion ($21.76 billion) worth of loans as wilful defaults in 2018-19, with the biggest lender State Bank of India accounting for nearly a third. Adding worries among traders, India’s services sector activity contracted in the month of June, as weak sales, competitive pressures and unfavourable taxation all hampered output. As per the survey report, the seasonally adjusted Nikkei Services Business Activity Index eased to 49.6 in June from 50.2 in May. However, bourses remained in green for the most part of the day and ended higher, amid reports that Commerce Minister Piyush Goyal took a decision to set up a Cooperative Sector Exports Promotion Forum (CSEPF) under the National Cooperative Development Corporation (NCDC) which will work with 20 states and union territories in the area of export to achieve an agriculture export target of $60 billion by 2022. Some support also came with after Union Minister of Skill Development and Entrepreneurship Mahendra Nath Pandey said that in coming months about 2.5 lakh new jobs will be created in the IT sector through the comprehensive skill Development programme. Finally, the BSE Sensex gained 22.77 points or 0.06% to 39,839.25, while the CNX Nifty was up by 6.45 points or 0.05% to 11,916.75.