Markets to continue their momentum with a positive start

The Indian markets surged and the benchmarks rose to their all time high in last session, supported by good global cues and positive economic reports. Today, the start of the markets is likely to remain in green and the benchmarks will extend their gaining momentum, however some profit booking too may appear in the latter part of the trade ahead of the weekend. Traders will be getting some support with an HSBC survey saying that India’s manufacturing and services sectors expanded at a faster rate than China in February even as emerging market economies grew at the slowest pace since September 2013. Today, the sugar stocks are likely to remain in action, as the industry body ISMA has said that country’s sugar production for the marketing year 2013-14 has been revised downwards by 1.2 million tonnes to 23.8 million tonnes due to lower output estimates in Uttar Pradesh. There will be some buzz in the steel and power sector too, as the Inter-Ministerial Group on coal blocks has recommended giving time until November to obtain forest clearance for eight mines allotted to companies such as JSPL and Tata Steel.

The US markets remained in consolidation mood and once again made a mixed closing ahead of the Friday’s monthly jobs report. However, there was good news from economy front as the initial jobless claims dropped to 323,000, from the previous week’s revised figure of 349,000. The Asian markets have made mostly a positive start, heading for their longest stretch of weekly gains since September.

Back home, boisterous benchmarks once again showcased an enthusiastic performance on Thursday, by rallying over a percentage point. Sentiments remained up-beat since start as key bourses opened with decent gains and there appeared not even an iota of profit booking in the session as the benchmarks managed to fervently gain from strength to strength, as investors continued their hunt for fundamentally strong stocks. Frontline indices not only extended their rally for third straight day but also recorded their all time closing high, settling comfortably above their crucial 6,400 (Nifty) and 21,500 (Sensex) bastions as investors took to hefty across the board buying.  Sentiments got bolstered on report that India’s current account deficit (CAD) came sharply lower at a four-year low to $4.2 billion or 0.9% of GDP in December quarter of 2013-14. The lower CAD was primarily on account of a decline in the trade deficit as merchandise exports picked up and imports moderated, particularly gold imports. Sentiments also remained up-beat after planning commission Deputy Chairman Montek Singh Ahluwalia said that the new government will need to revive investments and push infrastructure projects within the three months of being elected to bring economic growth back on track. Global cues too remained supportive with European markets trading higher in early deals ahead of the European Central Bank’s interest-rate decision. All the Asian markets too ended the session in green. Back home, there was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too participated strongly in the rally. Appreciation in Indian rupee too supported the sentiments. Meanwhile, Cement stocks remained on buyers’ radar on expectation of higher demand in coming months as March to mid-June period is among the peak periods for cement demand before the monsoon season kicks in. Banking stocks too performed well despite Finance Minister P. Chidambaram after a performance review meeting with public sector banks and financial institutions said that Public sector banks could report higher non-performing assets in the current financial year ending March. Finally, the BSE Sensex surged by 237.01 points or 1.11%, to settle at 21513.87, while the CNX Nifty gained 72.50 points or 1.15% to settle at 6,401.15.