On crucial rail budget day, markets may behave feeble

Indian equities markets closed lower for second consecutive session tracking broad-based selling amid weak global cues and also ahead of Railway Budget. Domestic market was also slightly volatile a day ahead of F&O expiry. The Sensex fell 321.25 points or 1.37% to 23088.93 and the Nifty dropped 90.85 points or 1.28% to 7018.70. The broader markets were also witnessing selling pressure, with BSE small-cap falling 1.15% and mid-cap shedding 0.79%.

U.S. stocks reversed losses from an intraday decline of more than 1.5% and closed higher on Wednesday, due to a rebound in crude-oil prices that occurred in the wake of weak U.S. economic data. The S&P 500 closed 8.53 points, or 0.4%, higher at 1,929.30; the Dow Jones Industrial Average ended 53.21 points, or 0.3%, higher at 16,484.99, reversing a more than 250-point drop. Meanwhile, the Nasdaq Composite rose 39.02 points, or 0.9%, to 4,542.61.

European stocks closed about 2% or more lower. The pan-European Stoxx 600 index closed 2.3% to 320.23. In Frankfurt, the DAX 30 fell 2.6% to 9,167.80. France's CAC 40 ended down 2% to 4,155.34. The FTSE 100 index dropped 1.6% to 5,867.18. Spain's IBEX 35 lost 3.1% to 8,013.70, while Italy's FTSE MIB dropped 2.6% to 16,719.3.

U.S. oil prices closed higher Wednesday in seesaw trading, as strong U.S. oil output fell as strong demand for gasoline pointed to a possible rise in demand for oil to make the fuel. Brent crude was up USD 1.21 at USD 34.48 a barrel. U.S. crude settled at USD 32.15 a barrel, up 28 cents, or 0.88%, after falling more than 4% at session's lows.

Markets in Asia traded in the mix in the morning session on Thursday. Japan's Nikkei stock index 225 added about 0.53% to 15,998 as the Yen swept away recent highs. South Korea’s Kospi index advanced 0.44% and Australia’s S&P/ASX 200 Index lost 0.2%. New Zealand’s S&P/NZX 50 Index slid 0.1%. China's Shanghai composite was lower by 1.22% and Hong Kong's Hang Seng Index was down 0.65%.

While on domestic front, A SGX Nifty 50 index future for February series traded down 2.5 points at 7,022. Indian markets are likely to open flat and going forward may remain volatile due to last day of F&O expiry today. Investors and analysts will be focused on Railway Minister Suresh Prabhu who will be presenting the railway budget 2016 today.