Markets to make a cautious start, recovery attempt likely

The Indian markets suffered sharp profit booking at the high points of the day in last session. Traders remained concerned about the economic and political conditions of the country and a good rally attempt was thwarted with across the board selling. Today, the start is likely to remain cautious, though some recovery attempt too can be expected from the beaten down segments. Traders will be watching the movement of the foreign funds movement who have become net sellers for last couple of days. Meanwhile, the Planning Commission Deputy Chairman Montek Singh Ahluwalia has reiterated that India can get back to 8 percent GDP growth with improved infrastructure. There is likely to be some action in IT sector stocks, as Gartner survey has stated that a majority of large Indian enterprises are planning to increase their IT spending this year. There will be some scrip specific actions related to 51 stocks including A2Z Maintenance, Bartronics India, Consolidated Construction, Khaitan Electricals, K S Oils, Triveni Engineering etc. whom Nifty will be shifting in T2T segment from April 12, as a part of the preventive surveillance measure to ensure market safety and to safeguard the interest of investors.

The US markets extended their gains on Tuesday, though the mood remained sluggish in early session but firmed up in second half on report of easing Chinese inflation and good start of the earnings season, as Alcoa's quarterly results came in above estimates. Most of the Asian markets have made a positive start led by the rise in commodity stocks, which moved higher ahead of Chinese trade data to be announced later in the day.

Back home, extending their losing streak for yet another day, stock markets in India staged a dismal performance on Tuesday with both the frontline indices snapping the session below their crucial 5,500 (Nifty) and 18,250 (Sensex) levels as investors turned cautious ahead of fourth quarter results. Earlier markets made a positive start and traded firmly in first half as sentiments got some support with the Asian Development Bank’s (ADB) outlook as the agency in an improvement over disappointing numbers last year, said that domestic consumption could boost India’s slowing economy to 6 percent growth this year. But, the domestic gauges pared most of their profit and turned red in noon trade as investors booked their initial profits ahead of Industrial production numbers which is due later this week. India’s industrial production is expected to shrink in February due to a contraction in infrastructure industry output and flagging demand, after a surprisingly strong rise in January. The factory production is expected to decline by 0.7 percent in February y-o-y, following a 2.4 percent surge in January. Selling got intensified in the late trade after a meeting of all political parties to arrive at a consensus over a proposed land acquisition law remained inconclusive. The leaders will meet again on April 18 to discuss the draft law. Meanwhile, reports of foreign funds emerging as net sellers in Indian equities for fourth consecutive session, with net selling of $30.03 million of equities on April 08, also dampened the sentiment at D-street. Market-men even shrugged off firm global cues as European counters traded firm in early session. Back home, selling in software and technology stocks too dampened the sentiments. IT stocks edged lower as weak US non-farm payrolls raised questions about the health of the US economy, the sector’s biggest revenue generator. Wipro slumped over 12% on the first trading session of demerger of non-IT business while, Infosys stock declined by over two percent, on concerns ahead of Q4 earnings. Selling in Capital goods pack too extended the downfall as stocks like BEML, Siemens, BHEL, Bharat Electronics and L&T edged lower on worries that ongoing slowdown in the economy could restrict new orders. Finally, the BSE Sensex shaved off 211.30 points or 1.15% to settle at 18,226.48, while the CNX Nifty plunged by 47.85 points or 0.86% to end at 5,495.10.