Result Announcements To Swing The Markets Today

Yesterday the markets were expected to be upbeat due a flow of positive global cues. The U.S. housing data showed a significant comeback, thus marking a revival in the industry. At the same time the data from China indicated a rise in retail sales and in industrial production, though the quarterly GDP came in lower sequentially. Moreover, in Europe, Moody’s avoided the downgrade of Spanish bonds, resulting in relief across Europe over the hanging uncertainty. This had the global markets shoot upwards. The Indian markets started quite soft on a flat to positive note. However, this trend picked up in a while and the markets ended the day with healthy gains of around 1 per cent.

The Sensex closed higher by 181.16 points at 18,791.93, up by 0.97 per cent and the Nifty closed higher by 58.45 points at 5,718.7, up by 1.03 per cent. Today, however, the markets would be closely watching ITC and TCS for their quarterly results.

After seeing thorough gains earlier, the U.S. markets saw a rough day with losses in the range of 0.06 per cent and 1 per cent. The indices were heavily weighed down by corporate results. Meanwhile, worries about growth at Chipotle and lower-than-expected results by Microsoft took a toll on the markets. Google too missed the estimates, sending the individual scrip and the markets lower. Motorola too disappointed investors by showing losses, resulting in a bleak mood on the bourses. Moreover, the U.S. data showed a jump in the initial jobless claims by 46,000 to a seasonally adjusted 3,88,000 in the week ended October 13. A couple of weeks ago, the Labor Department had said that the jobless claims had fallen to a four-year low but this turns out to be a seasonal anomaly in data that may occur at the end of a quarter.

Investors in Europe have been closely tracking the ongoing EU summit. Expectations of major development have been low. Moreover, the uncertainty over Spain officially asking for a bailout and whether to disburse a fresh round of aid to Greece remains at a peak. Regardless of the uncertainty, the general opinion is that eventually Spain would give in and that funds would be made available for Greece. This has resulted in gains in the European markets in the range of 0.1 per cent and 0.57 per cent.

The Asian markets remain mixed due to cues from Europe and the U.S. and due to the recent Chinese data. The European leaders have expressed their agreement on the fact that Greece has made progress on a cumulative basis, thus turning the sentiment positive. While the Hang Seng and Shanghai Composite are up by 0.25 per cent and 0.20 per cent, the Nikkei is down by 0.23 per cent.

The rupee weakened to its lowest level since nearly three weeks as there was tremendous demand for dollar seen from the oil firms. Oil was seen stabilising at around USD 113 per barrel mark resulting out of the improvement in Chinese data and supply worries from the Middle East. This resulted in a decline in the rupee which could have been to a larger extent but was evaded due to gains in the domestic equity markets.

The global cues for the day are mixed and the Indian markets may see a malleable opening. The markets would be closely watching out for the Q2FY13 results to be announced by ITC and TCS. Though TCS would post its results after the closing hour, there would be a good amount of volatility in the stock ahead of the results. Moreover, being heavyweights, the sentiment around these results is also likely to define the market direction for the day. Among other result announcements include Adani Ports, Adani Power, Alembic Pharma, Bajaj Finserv, eclerx, Exide, Gati, Gujarat State Fertilizers Company, ING Vysya Bank, ITC, L&T Finance, NIIT, Raymond, South Indian Bank, Strides Arcolab, Tata Sponge, TCS and Zee Entertainment. Being a day where many companies announce their results, volatility is likely to be high and market direction to be uncertain.