Markets open positive, Sterlite up over 4%

As we expected in our morning notes, the Indian markets have opened on a strong positive note following global and domestic cues. In the domestic markets, the IIP numbers stand at 6.8% while the CRR cut has also hinted that a rate cut is required, even though there is mixed reaction on the street as to when that will happen. The BSE Sensex is currently trading up by 200 points or 1.14% and the Nifty is up 64 points or 1.21%.

Other Asian markets are trading strongly in positives at the moment. Among the key markets, the Hang Seng is up 1.26% while Nikkei is up 0.92% and Shanghai has surged by 0.32%.

Earlier, the US and European markets ended higher on the positive sentiment created by the US employment data and the Greek swap deal.

Among the sectoral indices, Realty and Metals are both up by 2.4%. The CG, Power, Oil & Gas, PSU, IT, Bankex and Teck indices have also surged by over 1% each. The defensive sectors are marginally up at this moment.

Of the Sensex stocks, Sterlite Industries is leading with 4.15% gains and DLF is up 3.16%. PSU stocks such as BHEL, ONGC, NTPC, GAIL India and SBI are also trading up. Coal India is trading up as the company will pay a high dividend this year, with the record date for the same set as Feb 17, 2012. Among the others, Jindal Steel is up 2.59%. Maruti Suzuki, Tata Power, RIL, Tata Steel, L&T, Hindalco, Hero MotoCorp, Infosys, HDFC, ICICI Bank and Sun Pharma are also all up over 1%. On the other hand, Wipro is down 1.5% over the news of the stake sale by its promoter. M&M is also down 0.61%.

In other stocks, the shares of United Breweries are up by 13% for the second consecutive day. Manappuram Finance is also up over 10%. JSW Energy is seen gaining momentum. The markets expect good profits from the company in the Mar 2012 quarter owing to increased rates in the spot energy markets as well as seasonal demand. Biocon is down by 5.21% over the discontinuation of its contract with Pfizer. This will be seen as a big setback by the markets. Glenmark Pharma is also down 1.2%.

On the news of the compulsory license, Natco Pharma is trading up by nearly 3%.

The market breadth, which indicates the overall health of the market, is positive. Out of a total of 2251 stocks, 1523 stocks advanced and 629 stocks declined. 99 stocks remained unchanged.

With the positive opening, there is some respite for traders. Key events that will unfold are the inflation data (Wednesday, Mar 14), the RBI monetary policy review (Thursday, Mar 15) and the Union Budget (Friday, Mar 16). We believe that the markets' direction ahead will be decided by these factors. We expect markets to remain positive ahead in the day today.