Markets to continue their good run with a positive start

The Indian markets despite choppiness and weak global cues managed to extend their gains for the fifth straight day, riding on the election outcome hopes. Today, the start is likely to be in green though trade may remain range-bound and the traders will be cautiously eyeing the industrial output and inflation data, slated to be announced on Wednesday. However, auto stocks are likely to continue their upmove as the car sales grew marginally by 1.39% in February after witnessing a fall in sales since September last year. Excise cut in the interim budget of February 17, especially in small cars, two wheelers, commercial vehicles, seems to have shown its impact on the sales. On the same time the services sector stocks may come under pressure on data by Department of Industrial Policy and Promotion (DIPP), stating that foreign direct investment (FDI) into the services sector declined by about 60 percent to $1.59 billion in the first nine months of this financial year. Infra stocks too may hog the limelight on report that the Centre is planning to build nearly 200 low-cost airports in the next 20 years to expand connectivity to Tier-II and Tier-III cities.

The US markets continued their consolidation mood and ended marginally lower in last session, though major indices regained some ground over the course of the session in a relatively light day in terms of US economic news. The Asian markets have made a mixed start as investors weighed data showing China’s credit growth trailed estimates in February, though most of the indices are recovering from their previous day’s fall.

Back home, key domestic benchmarks managed to keep their head above water on Monday, extending their gaining streak for the fifth straight day, after a stirring tussle between bulls and bears during the session. Buying which emerged in late trade mainly acted as saving grace for domestic equity markets and helped them to hit fresh closing high levels. Overall, sentiments remained up-beat as Finance Minister P Chidambaram emphasized that the economy is presently more stable, as the fiscal and current account deficits are under control and the economy is more stable than it was 18 months ago. Positive opening in European counters too supported the sentiments, however, all the Asian markets shut shop in the red after trade data showed Chinese exports fell 18 per cent in February. Back home, stocks of banking license aspirants edged higher during the trade as the RBI Governor Raghuram Rajan said that the central bank would take a decision in the next few weeks, subject to approval of the Election Commission. Telecom stocks like, IDEA Cellular, Bharti Airtel and Reliance Communication too edged higher, despite the Planning Commission deputy chairman Montek Singh Ahluwalia said that operationalisation of the model code of conduct would delay spectrum sharing and trading by three to four months though the government had in principle approved the concept. On the flip side, shares of metal companies plunged after data on Saturday showed Chinese exports unexpectedly tumbled in February, raising fears of a slowdown in the world's second-largest economy. Finally, the BSE Sensex gained 15.04 points or 0.07%, to settle at 21934.83, while the CNX Nifty added 10.60 points or 0.16% to settle at 6,537.25.