Nifty May Flat At Opening Bell

Markets have closed lower for second straight session on Wednesday as weak monsoon forecast rekindled fears of higher inflation thereby dimming the prospects of further rate cuts by the central bank. Further, the slow pace of recovery in the economy continued to weigh on market sentiment.  The Sensex ended down 351.18 points or 1.3% at 26837.20 and the Nifty slipped 101.35 points or 1.2% at 8135.10. The BSE Mid-Cap and Small-Cap index shed 1.38% and 1.98% respectively. The decline in both these indices was higher than the Sensex's decline in percentage terms.

Market took further jolt after services sector activity contracted for the first time in 13 months in May, largely due to decline in new order flows amid competitive pressure. The HSBC India Services Business Activity Index, which tracks changes in activity at service companies, fell to 49.6 in May, from 52.4 in April since output prices in the private sector rose further, with the rate of inflation strongest in 13 months. Meanwhile, the seasonally-adjusted HSBC India Composite PMI Output Index -- which maps both manufacturing and services sectors -- fell to a 7-month low of 51.2 in May, from 52.5 in April.

U.S. stocks ended Wednesday with modest gains as the main indexes remained stuck in tight trading ranges ahead of the jobs report due on Friday. Market partly lifted by data showing private employers picked up hiring in May, while the rise in bond yields helped lift financial shares. The report comes ahead of the U.S. Labor Department's more comprehensive non-farm payrolls report on Friday. The S&P 500 closed 4.47 points, or 0.2%, higher at 2,114.07. The Dow Jones Industrial Average added 64.33 points, or 0.4%, to 18,076.27. The Nasdaq Composite ended the session up 22.71 points, or 0.5%, at 5,099.23.

Brent crude settled down USD 1.69 cents at USD 63.80 a barrel, and U.S. crude settled off USD 1.62 at USD 59.64 a barrel as traders and investors ignored a fifth straight weekly decline in U.S. crude stockpiles to focus instead on a big build in distillates.

European equities closed higher on Wednesday after ECB held its key interest rates unchanged and to keep quantitative easing running until September 2016. The pan-European Stoxx Europe 600 index slipped 0.1% to 395.93. Germany’s DAX 30 index posted one of the biggest gains among major country-specific indexes, rising 0.8% to close at 11,419.62. France’s CAC 40 index climbed 0.6% to 5,034.17, while the U.K.’s FTSE 100 index picked up 0.3% to 6,950.46.

Asian shares advanced early Thursday after a rebound in Wall Street as investors speculated Greece will reach a deal with its creditors. Japan’s benchmark gauge climbed as the yen declined against the dollar. The Topix index added 0.38%. South Korea’s Kospi index advanced 0.90%. Australia's equity markets fell 0.38%, hit more than four-month lows early Thursday, on the back of less than stellar economic data. New Zealand’s NZX 50 Index climbed 0.1%. The Hang Seng advanced 0.5% and the Shanghai Composite Index added 0.25%. The SGX Nifty was up 14.5 points at 8,157.5. Indian markets are likely to open flat.