Markets likely to make a positive start on sanguine global cues

The Indian markets remained in jubilant mood in the whole passing week, posting four percent gains. Today, the start of another crucial week is likely to be in positive but traders will wait and watch for the IIP data to be released tomorrow and the inflation numbers to be announced later in the week. However, the trade is likely to remain firm on sanguine global cues. Meanwhile, the Reserve Bank of India (RBI) has said that price stability was essential to help investors and consumers make informed choices and contribute to growth. There is likely to be buzz in the retail segment as Planning Commission Deputy Chairman Montek Singh Ahluwalia, pitching for FDI in online retail has said that he will take up the issue with Commerce and Industry Minister Anand Sharma, though FDI inflows in the country declined by 34% to $22.7 billion in 2012. On the other hand the export sector stocks too will keep buzzing as the industry body ASSOCHAM has claimed that over 1 million (over 10 lakh) people lost their jobs in the export sector during April-February period of the ongoing fiscal. A committee under Minister of State for Commerce D Purandeswari has been constituted to suggest ways to cut transaction cost of exporters in order to boost India's overseas shipments. There will be lots of scrip specific movements too, to keep the markets buzzing.

The US markets extended their gains on the final day of the week on getting better than expected jobs data, unemployment rate too declined, boosting the sentiments of the traders. Most of the Asian markets too have made a positive start tracking the gains in the US peers and decline in yen to the three and half year low against dollar. However, there was a marginal decline in the Chinese market after the economic data missed estimates.

Back home, the enthusiasm in Indian stock markets just doesn’t seem to be waning any time soon as buying momentum remained intact for the fourth session in a row, taking the benchmark equity indices to the highest levels seen in more than the last two weeks. The frontline indices surged by about one and a half percent in the session and re-captured psychological 19,650 (Sensex) and 5,900 (Nifty) levels buoyed by firm global cues. Sentiments also got some boost after leading global brokerage house Goldman Sachs, in a recent report, said it expects the benchmark index Nifty to hit the 7,000 mark by the end of this year. Goldman Sachs is overweight on markets where they see a favorable growth ‘deltas’ and where valuations are still attractive, such as China, India, Korea and Singapore. Markets picked up the pace tailing firm opening in European counters. Markets in Europe traded firmly in early deals with investors anticipating a stronger US jobs figure reading. Back home, sentiments got buttressed after Moody’s Analytics, an arm of the global ratings agency Moody’s forecasted that India’s economic growth in 2013 will be 6.2% from 5.1% in 2012. It said that the worst may be over for the Indian economy with December quarter likely the bottom of the economic cycle. Rally in banking stocks too aided the sentiments as stocks like Axis Bank, ICICI Bank, HDFC Bank, SBI, PNB, Union Bank and Yes Bank all edged higher on hopes of rate-cut in RBI’s upcoming policy meet. Some support also came in from a rally in stocks of state-run up-stream and down-stream companies like ONGC, Oil India, BPCL, HPCL and Indian Oil Corporation after the Indian government sought parliament’s approval to spend an additional Rs 24,774 crore on oil subsidies in the current fiscal year that ends in March. Sentiments also got some boost after Aviation stocks flew higher as the government decided to replace the present Director General of Civil Aviation with more powerful Civil Aviation Authority. Additionally, steel shares rose after the Minister of Steel, Beni Prasad Verma on March 7, 2013, said that the Supreme Court has permitted some mines in Karnataka to reopen. Finally, the BSE Sensex surged 269.69 points or 1.39% to settle at 19,683.23, while the CNX Nifty jumped by 82.40 points or 1.41% to end at 5,945.70.