Markets to get a flat-to-cautious start

The Indian equity markets extended their gains in last session despite some weak economic data and political upheavals as the opposition paralysed parliament. However, benchmarks gained around half a percent supported by metal, IT and Tech stocks. Today, the start is likely to remain cautious-to-flat and the markets may consolidate lacking any major cues. Banking stocks are likely to remain under focus with nearly all the banks and insurance companies targeted by the recent sting operation by online portal Cobrapost. The finance ministry and insurance regulator IRDA have initiated independent investigations into the matter. Meanwhile, the government has said that the recommendations of Group of Ministers (GoM) on setting up independent regulatory authority for the coal sector are expected shortly. Aviation stocks too will keep buzzing as the directorate general of civil aviation (DGCA) is planning to regulate the charges that the airlines plan to levy for some of the unbundle services. DGCA is looking at framing regulations to cap the number of preferential seats airlines can offer in a flight.

Also, there will be lots of important result announcements to keep the markets in action. Allahabad Bank, Ceat, Glaxosmithkline Pharma, Glenmark Pharma, Oracle Financials and RPG Life Sciences will be among many to announce their numbers.

The US markets made a mixed closing on Monday in a light trading day, though the markets continued to benefit from the recent upward momentum but many traders remained on sidelines lacking any major US economic data and earnings news. Most of the Asian markets have made a positive start after the European Central Bank said it’s ready to cut interest rates further.

Back home, Buoyed by firm regional cues, Indian equity markets snapped the volatile day of trade near intraday high with both the frontline gauges re-conquering their crucial 5,950 (Nifty) and 19,650 (Sensex) levels. The frontline gauges started the session on a positive note supported by firm trade across the Asian region but pared almost all of their gains couple of time during the trade as sentiments turned choppy after global credit rating agency Standard & Poor’s though ruling out rating upgrade for India at the current juncture, indicated improvement in rating outlook. The agency also said, India could maintain a sustainable 7-8% growth rate if it is able to bring down its fiscal and current account deficits (CAD) to 3% of GDP level. Sentiments in the early deals also remain dampened after selling was witnessed in banking space after investigative website Cobrapost accused 23 public and private financial institutions for facilitating money laundering. Weaker than expected services PMI data too played the spoilsport for the markets as HSBC services Purchasing Managers’ Index (PMI), based on a survey of around 400 companies, fell to its slowest pace in one and half years to 50.7 in April from 51.4 in March. Sluggish opening in European counters also took their toll on domestic markets due to which Sensex and Nifty turned slightly in red for a brief period. Meanwhile Asian markets ended the session mostly in green. The domestic markets, however, picked up speed in the last leg of trade supported by continued buying in software and technology stocks. Scrips like, Infosys, Wipro and TCS edged higher after a strong US job report for April 2013. Sentiments also got some support after Prime Minister Manmohan Singh, assuring international investors that India is committed to its economic growth agenda said, the government is taking steps to make India a more attractive investment destination with a view to achieve over 8% economic growth in the 12th Five Year Plan. Power stocks too remained on the buyers’ radar after the power Minister Jyotiraditya Scindia said that the country's electricity generation capacity will surge to nearly 315 gigawatts by fiscal year 2016-17 with an estimated investment of about Rs 5 lakh crore. Finally, the BSE Sensex gained 98.00 points or 0.50% to settle at 19,673.64 while the CNX Nifty rose by 27.05 points or 0.46% to end at 5,971.05.