Markets likely to get a flat-to-positive start

The Indian markets managed to extend their gaining streak in the last session, though the gains were modest and the trade too remained choppy. Today, the start is likely to be steady and traders will look for strong cues to extend their bets. Meanwhile, the Prime Minister’s Office (PMO) has asked the Planning Commission to formulate a draft Bill on Dispute Resolution in Public Contracts in consultation with all stakeholders and Ministries. As the government aims to get 50 percent of its $1 trillion investment target for infrastructure sector from private companies. There will be some buzz in the export oriented stocks, as the External Affairs Ministry has said that it will draw a roadmap for Indian Missions abroad to push export promotion activities and help the country to arrest export slowdown. At the same time there will be reaction in pharma sector after the government issued the long-pending drug price control order, paving the way for the implementation of national pharmaceutical pricing policy, which will lead to a reduction of an average 20-25% in medicine prices.

Also, there will be some important result announcements too, to keep the markets buzzing. Balaji Tele, ITC, Motherson Sumi, NIIT Tech, Sun TV Network are among the many to announce their numbers today.

The US markets turned lower on Thursday, though there was a pullback in last but a disappointing batch of US economic data weighed on the markets. While, the housing starts tumbled 16.5%, the jobless claims increased by 32,000. Some of the trading Asian markets are in flat-to-positive terrain; Japanese market was in a bit consolidation mood.

Back home, key domestic benchmarks, extending their rally to third consecutive day, ended the session with marginal gains supported by rally in banking stocks, which extended their gains on hopes of rate cut by the central bank. Sentiments also remained up-beat after Moody’s statement that Indian economy is expected to pick up and grow in the range of 5.5-6.5 percent in 2013. Buying was witnessed from foreign investors after the newly appointed Law Minister Kapil Sibal cleared a SEBI regulation which permits put and call options in mergers and acquisitions. Foreign institutional investors (FIIs) were net buyers of Rs 1,647 crore of stocks on May 15, 2013, marking their biggest single day of buying since February 7, 2013. Supportive cues from US markets provided the much needed support to local markets initially. However, Asian markets closed on a mixed note on Thursday. Back home, realty stocks like, DLF, Indiabulls Real Estate, Unitech, DB Realty, HDIL, Parsvnath Developers and Anant Raj Industries extended their rally as the latest data showing a sharp fall in wholesale price inflation in April 2013 raised hopes that the RBI may further cut policy rates to perk up economic growth. Lower interest rates may help revive demand for properties. Some support also came in after buying was witnessed in oil and gas counter led by over two and a half percent rally in index heavyweight Reliance Industries. Meanwhile, traders also shrugged off negative news for the sector that Oil Ministry’s proposal for an across-the-board near doubling of natural gas prices has been rejected by the Cabinet Secretariat. However, gains remain capped after Moody’s noted that the Current Account Deficit (CAD) remains a persistent concern for India. Sentiments also got dented after a survey showed that India’s economic confidence dropped by 2 points to 63 percent in the month of April, 2013 compared to the month of March, 2013 and now the country is the sixth most economically confident country in the world after Saudi Arabia, Sweden, China, Canada and Germany. Finally, the BSE Sensex gained 34.37 points or 0.17% to settle at 20,247.33, while the CNX Nifty rose by 23.15 points or 0.38% to end at 6,169.90.