Markets likely to make a positive start of the F&O expiry week

The Indian equity markets extended their declining trend in the last session, losing another over a quarter percent; global concerns kept weighing on the market sentiments. Today, the start of the new holiday shortened crucial F&O expiry week is likely to be in green. Markets may recover some of their last week losses on positive global cues. The oil & gas sector stocks will be in action as Petroleum Minister M. Veerappa Moily has said that the Prime Minister-headed Cabinet Committee on Investments would take up 31 oil and gas blocks stuck for clearances in 'two-weeks'. He has also said that the government plans to strengthen India's energy security by taking policy initiatives for exploration of shale gas and coal bed methane. The PSU OMCs too will rejoice, as the government will give an additional cash subsidy of Rs 25,000 crore to make up for the losses suffered by them on selling fuel at subsidised rates. On the other hand the real estate stocks are likely to remain under pressure as the housing ministry is pushing hard to bring the real estate regulator bill, in the current session of Parliament despite stiff opposition from private developers and builders. There will be some buzz in the power sector stocks too, as country’s power generation in the last month fell short of target by 6,000 million units, mainly due to drop in thermal and hydro power production.

The US markets rebounded in late trade to finish higher on Friday on hopes that Cyprus will find a solution to avert the default, there were some good earnings announcements too that helped the markets move higher. Today, most of the Asian markets have made a positive start with Japanese market taking the lead after an agreement by Cyprus to an international bailout.

Back home, pressurized by feeble global cues, key domestic benchmarks once again ended the volatile day of trade in red terrain extending their losing streak for the sixth consecutive session. The benchmarks got off to a flat but positive opening, shrugging the somber sentiments prevailing in Asian markets. However, the indices slipped into the negative territory and even went on to test important psychological 18,700 (Sensex) and 5,650 (Nifty) levels. The key gauges got solid support around those intraday low levels as they convalesced from thereon. The indices tried hard to move back into the positive territory and even got there but only for a brief period as investors took the opportunity to cash in on the bounce back. The bourses finally extended the declining run for the sixth session but finished way above intraday lows. The investors mainly resorted to profit booking due to feeble global cues as most of the Asian counters shut shop in the negative terrain on fears that Cyprus may default on its debt. Back home, some revival was seen in late hour of trade where the frontline counters paring all their intraday losses turned into the green terrain but, the recovery proved short lived as local bourses once again dipped into red. Continuing worries over the country’s political stability dampened the trading sentiment while, drubbing in blue chip stocks, viz. SBI and ICICI Bank on doubts over the prospects of future rate cuts also soured sentiment at D-Street. Some pressure also came in after, fertilizer stocks like National Fertilizers, Nagarjuna Fertilizers, Rashtriya Chemicals and Fertilisers, Chambal Fertilisers, Gujarat State Fertilisers and Coromandel International went through the floor as subsidy payment worth Rs 31,580 crore is likely to remain outstanding to the manufacturers this fiscal. Bucking the trend, two-wheeler firms Bajaj Auto and Hero MotoCorp were among the top Sensex gainers up 2-4 percent each. Hero MotoCorp was up on media reports that the company plans to spend nearly Rs 1,100 crore on capital expenditure and has formulated a strategy to take on its rivals. Finally, the BSE Sensex lost 57.27 points or 0.30% to settle at 18,735.60, while the CNX Nifty declined by 7.40 points or 0.13% to end at 5,651.35.