Market likely to open flat; Textile and Telecom in focus

Indian equities indices settled in red on Tuesday after a two-day winning run as investors booked profit in recent gainers amid caution ahead of crucial British referendum vote. Sensex closed 54.14 points down at 26812.78, while Nifty 50 index settled 18.60 points down at 8,219.90. While the broader markets, Midcap and Smallcap indices outperformed, up 0.12% and 0.36%, respectively. Sentiment was also dampened as rupee further weakened by more than 20 paise against the dollar.

U.S. stocks closed slightly higher on Tuesday after Federal Reserve Chair Janet Yellen said the Fed would remain cautious in raising interest rates and investors refrained from making big moves ahead of the U.K.’s vote on whether to leave the European Union. The S&P 500 rose 5.65 points, or 0.3%, to close at 2,088.90. The Dow Jones Industrial Average rose 24.86 points, or 0.1%, to 17829.73, rising for a second consecutive day. Meanwhile, the Nasdaq Composite Index declined 6.55 points, or 0.1%, to finish at 4,843.76, after trading within a 26-point range.

Europe’s stock markets rose further on Tuesday, with traders expecting Britain to vote to stay in the European Union despite polls putting the race neck and neck. In the eurozone, Frankfurt’s DAX 30 index grew 0.5% and the CAC 40 in Paris won 0.6%, as data showed investor confidence in Europe’s biggest economy, Germany, hit a nine-month high. The Stoxx Europe 600 added 0.7%, its third consecutive day of gains. London’s FTSE 100 rose 0.4%.

Oil prices reversed their losses in post-settlement trade after API data showed a bigger-than-expected draw on inventory. WTI oil traded up 28 cents at USD 50.24 a barrel, while Brent crude traded up 35 cents at USD 50.95 a barrel.

Asian markets are trading in the mix on Wednesday, as nervous investors counted down to Britain's make-or-break EU referendum, while Federal Reserve Chair Janet Yellen commented that the Fed would remain cautious in raising interest rates. Japan's Nikkei 225 index Index is losing 166 points or 1.02% to 16,003 while the Kospi index is up 0.20%. Australia’s S&P/ASX 200 and New Zealand’s S&P/NZX 50 Index are down 0.12% and 0.49% respectively. Chinese markets are trading flatly.

On the domestic front, A SGX Nifty 50 index future for June series is trading down by 5 points at 8,215.50. Indian markets are likely to open flat tracking SGX Nifty. Textile and Telecom stocks may remain in focus due to a mega cabinet meet, which is set to consider the new textile policy and the upcoming spectrum auction on Wednesday.