Markets May Open Positive In line With Global Cues
DSIJ Intelligence / 15 Jul 2012
The Indian markets may continue to open on a positive note ahead in line with the global cues.
The Indian markets may continue to open on a positive note ahead in line with the global cues.
| Benchmark Indices | ||
|---|---|---|
| Index | Closing | % Change |
| SENSEX | 17213 | -0.11 |
| NIFTY | 5227 | -0.15 |
| Dow Jones | 12,777 | 1.6 |
| S&P 500 | 1356 | 1.62 |
| NASDAQ | 2541 | 0.16 |
| Bovespa | 54330 | 1.7 |
| FTSE | 5,666 | 1.02 |
| DAX | 6557 | 2.1 |
| CAC | 3180 | 1.43 |
| .. | ||
| Hang Seng | 19092 | 0.35 |
| Nikkei | 8724 | 0.05 |
| Shanghai | 2186 | 0.53 |
Last week the Indian markets went through events which kept the investors and markets both on their Toes. The event began on negative note with the poor show of Infosys which dented the markets sentiments. However later on Friday better than expected IIP number and then strong quarter result by TCS turned the market sentiments positive. The IIP data for the month of May came in at 2.4 per cent, which was higher than the street expectation of around 1.7 per cent.
However if we look at the weekly performance positive IIP number and good show by TCS were weighed down by the weak global markets. The week ended the broader Indices lower almost by 1.7 per cent.
The Asian markets on Friday ended on marginal positive note on the back Chinese GDP data which came in line with the market’s expectations at 7.6%. There was some respite on Friday after China announced the GDP numbers for the Second quarter. However the performance remained negative for the week on the back of uncertain macro environment and growth concerns. Also the earning season in the major economies kick started on a weak note which raised the concerns over slowing growth.
On the global front, the U.S. stocks rose sharply on Friday, taking the Dow industrials and S&P 500 into positive terrain for the week, as bank shares rallied after J.P. Morgan Chase & Co.’s second-quarter results. European Shares too posted their highest close in more than a week on Friday as better-than-expected Chinese growth data propelled gains in mining stocks and helped offset fresh worries over the euro zone debt crisis.
Back on the Indian turf the rupee continues to hover around Rs 55.65 per USD. It has eased a little but continues to cause concern over the rising fiscal deficit since this will increase the import bill of the oil companies. The import cost will rise further as London Brent crude has again moved northwards from the lower level of USD 89 to USD 100 per barrel. This is after the US saw decline in their inventory levels. If crude continues its upward trend and again reaches the USD 125 levels, it would push inflation to a higher level and worsen our balance of payments, thereby affecting the economy.
| Currency Rates | ||||
|---|---|---|---|---|
| Rs/$ | Rs/Euro | Rs/GBP | Rs100/JYP | |
| RBI Rate | 55.65 | 67.87 | 85.88 | 70.26 |
| Future | 55.27 | 67.35 | 85.36 | 69.64 |
| Key Global Indicators | ||
|---|---|---|
| Gold (Rs/10gm) | Crude ($/bbl) | |
| Spot | 29146 | 100.7 |
| % change | - | -0.06 |
| Future | 29272 | 87.07 |
| % change | -0.02 | -0.23 |
For the whole week we expect markets to remain volatile as series of major events such as Wholesale Price Index (WPI) data is expected to be out on July 16 and the Consumer Price Index (CPI) on July 18. The RBI is keenly watching the inflation numbers which will help them to decide their stance on the interest rate cuts which is scheduled on July 31. Also any news on the global front, especially from the U.S. and Europe, would further take the market in either direction.
In conclusion, for today we expect the markets to open on a positive note on the back of positive global cues. However we advise investors to remain cautious and adopt a ‘wait and watch’ approach and take cues from all these major events.
Meanwhile, keep a watch on stocks like Exide Industries, Castrol India, Supreme Infra, Tata Coffee, Steelcast, etc which are going to post their June 2012 quarter results. These stocks may see some price movement.
| FII | DII | |||||
|---|---|---|---|---|---|---|
| Trade Date | Buy | Sales | Net | Buy | Sales | Net |
| 13-Jul-12 | 1,957.01 | 1,675.88 | 281.13 | 611.04 | 981.45 | 370.41 |
| 12-Jul-12 | 2,470.46 | 2,201.92 | 268.54 | 841.76 | 1,379.74 | -537.99 |
| 11-Jul-12 | 2,365.00 | 2,280.62 | 84.42 | 759.44 | 1,116.29 | -356.86 |
| 10-Jul-12 | 2,170.30 | 1,563.70 | 606.5 | 830.2 | 1,318.50 | -488.3 |
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