Markets likely to open in red

Indian markets ended higher for third straight session on Monday. Today, markets are likely to make weak start as investor sentiment turn pessimistic overseas amid surging crude oil prices. Investors will be eyeing the 47th Goods and Services Tax (GST) Council meeting to begin today. The council is expected to consider rate hikes for a slew of items and steps to check evasion like biometric authentication of high-risk taxpayers. The GST Council will also consider a report of the panel of state ministers headed by Kerala finance minister KN Balagopal on making e-way bill mandatory for intra-state movement of gold above a threshold of Rs 2 lakh. However, some support may come as a report by the government think-tank NITI Aayog estimates India’s gig economy could employ 2.35 crore people by FY30, representing a three-and-a-half-times increase over 10 years. The gig economy employed around 68 lakh people in FY20. Traders may take note of report that India and the European Union (EU) resumed negotiations, after a gap of over eight years, for a comprehensive free trade agreement, a move aimed at strengthening economic ties between the two regions. Meanwhile, the latest data released by the Reserve Bank of India (RBI) showed that credit card spends hit an all-time high in May, reaching Rs 1.14 trillion and registering 8 per cent month-on-month growth over April. NBFCs will be in focus as modifying its earlier order, the finance ministry has permitted state-owned NBFCs to issue Letter of Comfort (LOC) to banks for fund tie-up for infra projects. It said NBFCs should be involved in infrastructure sector and LOCs should be provided by banks only for opening letter of credit for supply of goods and services by foreign suppliers. There will be some reaction in power stocks as S&P Global Commodity Insights said India is continuing to grapple with a severe and protracted power crisis after a sustained surge in global coal prices in late-2021 was further aggravated by Russia's invasion of Ukraine in February.

The US markets ended lower on Monday with a few catalysts to sway investor sentiment. Asian markets are trading in red with investors taking their cue from a volatile Wall Street session overnight.

Back home, Indian equity benchmarks extended their winning run for the third straight session on Monday, as buoyancy across the global markets boosted sentiment. Key gauges made gap-up opening, as sentiments got a boost with Commerce and Industry Minister Piyush Goyal’s statement that India is one of the fastest-growing economies in the world and it is expected to reach $30 trillion in the coming 30 years. He said if India grows at 8 per cent every year on a compounded annual growth basis, the economy will double in about nine years. Some optimism also came as a private report stated that India is rapidly emerging as a preferred country for foreign investments as the steps taken by the government led by Prime Minister Narendra Modi during the last eight years have borne fruit as is evident from the ever-increasing volumes of FDI inflow setting new records. Key indices continued to trade in green in second half of trading session, taking support from a private report stating that India’s economy gathered momentum in May driven by pent up demand for services and higher output from industries as reopening continued from pandemic restrictions. Additional support also came as the Reserve Bank of India (RBI) said that net profits of manufacturing companies surged by 50.2 per cent during 2021-22, the input cost pressures notwithstanding. It said net profit also increased for the information technology (IT) companies, whereas the non-IT services sector continued to record losses at the aggregate level. However, markets trimmed some gains in late afternoon deals, as there was some cautiousness as too with latest data released by the Reserve Bank of India (RBI) showed India's foreign exchange reserves declined $5.9 billion to $590.59 billion for the week ended June 17. Finally, the BSE Sensex rose 433.30 points or 0.82% to 53,161.28 and the CNX Nifty was up by 132.80 points or 0.85% to 15,832.05.