Markets to Open Flat with No Major Trigger

The domestic markets broke all crucial supports and plunged into deep red on the worries over interest rate cut by US Fed and unexpected rain fall across the country. Due to the unexpected strong US jobs data on last Friday, the investors are started expecting that the Fed rate cut will happen well ahead of its earlier announcement June 2015. The hike in US interest rate will enable FII net outflow from the Indian economy in near future. Further, the unexpected rain across the country also raised worried about the lower food production and lower disposable income for the farmers across the country affecting various consumer based industries in coming days.

On positive side, the government was recently able to raise good amount of money from its telecom spectrum and coal auctions. Interestingly, the telecom auctions bids rose to Rs 94000 crore which is close to 2010’s record of Rs 106000 crore from spectrum sales. However, the investors were worried about the profitability and future cash flows of these companies.

The European markets fell after touching multi year highs on the concerns over the Greek debt issues. The Eurozone official worried about the slow speed of reforms related to Greek’s bailout. The officials have warned the Greece government and advised to speed up its reform process. The French stock market index CAC 40 closed down by 0.55 per cent at 4937. The German stock market index DAX was marginal up by 0.27 per cent at 11582 during the last trading session. The UK FTSE closed at 6876, down by 0.51 per cent.

US markets ended in positive yesterday after a massive selling pressure on Friday’s trading session. also Monday marked the 6th anniversary of the bull market, with the S&P 500 more than tripling since it hit the bottom on March 9, 2009. The Nasdaq closed at 4942, up by 0.31 per cent. The S&P 500 and Dow industrials closed at 2079 and 17996, up by o.39 and 0.78 per cent respectively.

The Japanese markets were trading in green on the weakening of yen near to its multiyear low. The Japanese Nikkei 225 was trading at 18862, up by 0.38 per cent in Tuesday morning. The Australian markets were too trading higher and the Australian ASX 200 were firm at 5845, up by 0.40 per cent. the Hong Kong stocks were trading lower as Chinese inflation data due later in the day. The Hang Seng index was trading at 24064, down by 0.25 per cent. 

The SGX Nifty was too trading in green territory with marginal 12 points gain on the bourses. We too expect markets to open flat and experience range bound trading session.