Markets likely to open in green on Tuesday

Indian markets ended higher on Monday led by financial stocks and Eicher Motors. Today, the markets are likely to continue optimism with positive start for second consecutive day tracking firm global cues. Traders will be getting some encouragement with a private report that the phase 2 human clinical trial of the Oxford COVID-19 vaccine candidate by Pune-based Serum Institute of India (SII) is set to begin from Tuesday. The observer-blind, randomised controlled study to determine the safety and immunogenicity of Covishield on healthy Indian adults will begin at Bharati Vidyapeeth Medical College and Hospital in Pune. Some support will also come as ratings agency Crisil said it expects India’s retail food inflation, measured through the Consumer Price Index (CPI), to ease in the second half of this financial year owing to the effect of high base of previous year coupled with a bumper rabi harvest and good prospect of kharif harvest. Traders may take note of report that the government is considering a proposal to permit foreign direct investment (FDI) in limited liability partnership (LLP) firms engaged in construction development with a view to attracting overseas fund inflows. Meanwhile, the government has extended the validity of expiring driving licence and motor vehicle documents till December 31 in view of the prevailing condition in the country due to coronavirus. Though, rising coronavirus cases in the country may keep upside in check. India has recorded 59,696 coronavirus cases in the past 24 hours, taking its total to 3,164,881. With 854 fatalities reported on Monday, the country's death toll has surged to 58,546 - only a notch below Mexico. Telecom stocks will be in focus as the Supreme Court reserved its judgment on the AGR case after several rounds of hearing. The court observed that if telecom companies are unwilling to pay their dues, it would direct the Union government to cancel their spectrum allocation and licence.

The US markets ended higher on Monday  following upbeat news on the coronavirus front, with companies that have been hit hardest by the pandemic, like cruise operators and airlines, helping lead the markets higher. Asian markets are trading mostly in green on Tuesday following rally on Wall Street overnight.

Back home, extending gains for second straight session, Indian stock markets ended around one percent higher each on Monday, as signs of progress in developing a Covid-19 treatment offset fears about resurgence in virus cases that could risk stifling an economic recovery. Markets made optimistic start and stayed in green for whole day, amid firm cues from global markets. Traders took encouragement with union minister Nitin Gadkari’s statement that focus on critical infrastructure building through an integrated approach, right from a number of strategic tunnels and bridges to 22 green expressways, is bound to place India in the league of advanced nations like the US, UK and Australia in the coming two years. Investors got some comfort with data showing that investments through participatory notes (P-notes) in the domestic capital market soared to Rs 63,288 crore till July-end. Domestic bourses added more strength in second half of the session, as traders remain energized with Ministry of Finance stating that businesses with an annual turnover of up to Rs 40 lakh are Goods and Services Tax (GST) exempt and those with a turnover up to Rs 1.5 crore can opt for the Composition Scheme and pay only one percent tax. Initially, this limit was Rs 20 lakh. Adding to the optimism, the government has come out with norms for the enforcement of 'rules of origin' provisions for allowing preferential rate of customs duties on products imported under free trade agreements. The new norms have been framed with a view to checking inbound shipments of low quality products and dumping of goods by a third country routed through an FTA partner country. Traders also took a note of US India Strategic and Partnership Forum (USISPF) president Mukesh Aghi’s statement that India needs to look at environmental, social and governmental (ESG) factors to attract major investors and get the sustained foreign direct investment (FDI) of $100 billion per annum that the country needs to get back to 8-9 percent growth. Finally, the BSE Sensex rose 364.36 points or 0.95% to 38,799.08, while the CNX Nifty was up by 94.85 points or 0.83% to 11,466.45.