Markets likely to open flat tracking SGX Nifty

Indian equities ended in positive despite the Reserve Bank keeping the interest rate unchanged. Sentiment also got a fillip early in the day tracking world equity markets after dovish tone from Janet Yellen cooled near-term US rate hike possibilities. The Sensex closed above 27000-mark for the first time since October 2015, which climbed 232.22 points or 0.87% to 27009.67 and the Nifty gained 65.40 points or 0.80% at 8266.45. In broader markets, the BSE Small-cap index surged 0.96% and the Mid-cap 0.29%.

The Reserve Bank of India kept repo rate at 6.5% and cash reserve ratio at 4%, unchanged, which was in-line. Governor Raghuram Rajan pointed out the rising inflation concerns after April data, but he kept January 2017 CPI Inflation target unchanged at 5% with upside bias. The Central Bank also retained the growth projection at 7.6% for FY17 citing corporate profits and surge in consumption.

U.S. stocks closed with eked out modest gains Tuesday as the price of oil closed above USD 50 a barrel for the first time in almost a year. The S&P 500 closed up 2.72 points, or 0.1%, at 2,112.13 and the Dow Jones Industrial Average rose 17.95 points, or 0.1%, to 17,938.28. Meanwhile the Nasdaq Composite Index declined 6.96 points, or 0.1% to 4,961.75.

European stock markets posted strong gains Tuesday as oil prices rose and the latest comments from Fed chair Janet Yellen, boosted investor sentiment. The Stoxx Europe 600 tacked on 1.1% to close at 346.26. Germany’s DAX 30 jumped 1.7% to 10,287.68; and France’s CAC 40 rose 1.2% to 4,475.86. The U.K’s FTSE 100 rose 0.2% to 6,284.53.

U.S. oil prices settled above USD 50 a barrel Tuesday for the first time since July on expectations of continued declines in supply and also seem to be shaken over potential supply shortages from attacks on Nigeria's oil industry. WTI oil settled up 67 cents, or 1.3%, at USD 50.36 a barrel and Brent rose 89 cents, or 1.8%, to USD 51.44 a barrel.

Mostly Asian markets opened in red on Wednesday ahead of Chinese trade data that has been forecasted to show declines in shipments. Japan's Nikkei 225 index slumped 0.33% due to stronger yen. In Australia, the S&P/ASX 200 Index lowered 0.41% and the New Zealand’s S&P/NZX 50 Index slid 0.46%. The Kospi Index was marginally up by 0.10%. Chinese markets opened the session in negative territory; Shanghai composite was down 0.75%.

On the domestic front, A SGX Nifty 50 index future for June series is trading up by 5 points at 8,294. Indian markets are likely to open flat tracking SGX Nifty.