Markets to see some recovery on final trading day of week

The Indian markets were dragged in the global meltdown in last session and suffered severe cut of around two percent. Volatile domestic currency too added to woes of the qualms in the market. Today, some stability can be expected and the benchmarks could see some recovery after four consecutive sessions of decline. Marketmen will be getting some support with Finance Minister P. Chidambaram's statement that there is no need for any kind of nervousness. He has said that the Indian markets should read the situation correctly rather than be influenced by something elsewhere. Traders will be eyeing the movement of rupee; meanwhile Prime Minister's Economic Advisory Council Chairman C Rangarajan has said that the exchange rate of the local currency will be determined by the capital flows. However, he also added that pressure can develop on occasions because of the mismatch between the current account deficit and the capital flow. The PSU oil companies will be in action, as the Finance Minister has said that the cash payouts to oil firms this fiscal will be just Rs 20,000 crore.

There will be some result reaction too, to keep the markets buzzing. Ajcon Global, Britannia Inds, Gammon Infra, ICRA, Jet Air India, Karur Vysya Bank, Spicejet are among the many to announce their numbers today.

The US markets despite coming off their early lows, ended marginally in red on Thursday. After a soft start markets got a rebound from upbeat housing data that helped offset worries about the Federal Reserve's probable tapering off the stimulus measure. Asian markets have mostly made a positive start as the Japanese market recovered from its sharpest plunge since March 2011 as financials and real estate shares regained ground. Chinese market too has recovered on some deal news.

Back home, Indian equity markets witnessed butchery on Thursday with both the major indices losing nearly two percent and closed near their lowest level in almost eight and a half weeks, breaching major crucial support levels 19,700 (Sensex) and 6,000 (Nifty) on feeble global cues. A gap-down start of markets never looked in recovery mood and continued sliding till end, closing near the lowest point of the day. Selling was both brutal and wide based as none of the sectoral indices on BSE were spared. However, counters which featured in the list of worst performers, include realty, capital goods and power. Sluggish global cues remained the major reason behind the sell-off in domestic markets. European counters made a gap down opening as Italy reported disappointing economic data on Thursday, where retail sales fell by 0.3 per cent month-on-month in March. Asia Pacific indices too ended in red as sentiments got dented after Chinese May HSBC flash PMI data shrank for the first time in seven months. Back home, selling in Metal space too dampened the sentiments with stocks like NMDC, Jindal Steel & Power, Hindalco Industries, Tata Steel, Sterlite Industries and Nalco ending in red after the preliminary HSBC China Manufacturing Purchasing Managers’ Index fell to 49.6 in May 2013. Some disappointment also came in from currency front where Indian Rupee depreciated to its lowest level in over eight and a half months to breach 56 per dollar level. Though, it recovered up to certain extent later on some suspected RBI intervention. Slight recovery was seen in noon trade after Finance Minister P Chidambaram said that the Fed statement on the possible scaling back of the bond buying programme has been misunderstood. But, the selling intensified in last leg of trade after disappointing set of Q4 numbers from State Bank of India (SBI) dented the sentiments. The bank’s net profit contracted 18.54 percent at Rs 3,299.22 crore as compared to Rs 4,050.27 crore in Q4 FY12. BHEL’s Q4 earning too upset the street, with the company’s net profit declining by 4.22 percent to Rs 3,237 crore from Rs 3,380 crore in same quarter last year, while its net sales were down by 2.15 percent to Rs 18,850 crore. Finally, the BSE Sensex shaved off 387.91 points or 1.93% to settle at 19,674.33, while the CNX Nifty plunged by 127.45 points or 2.09% to end at 5,967.05.