Markets May Open Higher

The Indian markets may open on a positive note as SGX Nifty is trading up by 18.50 points at 5,601.50, indicating a green start-up for the markets in the early trades.

Yesterday the markets closed on a very flat note with the Sensex closing marginally lower in the negative territory while the Nifty closed on the same level as of Monday, though marginally in the green. The markets today may see a positive kick-off at least in the initial trades as overnight the developed markets closed higher and the Asian indices are also reflecting positive sentiments across the streets. However, during the latter part of the day we may see volatility in the frontline indices as participants might take up speculative trade ahead of the winter session of the parliament which will take off tomorrow.

The U.S. markets ended yesterday’s trade higher with major indices like Dow Jones, S&P and Nasdaq closing in the range of 0.02 to 0.16 per cent respectively. According to a Bloomberg report, the new home construction data unexpectedly climbed to a four-year high in October, providing evidence of a revival in the industry that’s helping propel the American economy.

The European markets too closed higher with major indices like the FTSE, CAC and DAX closing in the range of 0.2 to 0.7 per cent respectively. According to a Bloomberg report, the European governments are trying to plug an immediate hole in the finances of Greece and prevent new ones from opening in the latest installment of the debt-crisis brinkmanship rattling the euro economy.

Taking cues from the overnight developed markets, the Asian markets have also opened higher with Shanghai Composite and Hang Seng up by 0.35 and 0.74 per cent respectively while the Japanese index Nikkei is up 1.12 per cent at 9,246. Japanese exports fell for the fifth month in a row, adding pressure for the central bank to add stimulus measures as the world’s third-largest economy moves closer to recession. Further, a Bloomberg report said that elections in Japan next month are expected to hand over power to opposition leader Shinzo Abe who is in favour of aggressive monetary easing.

The rupee has again started depreciating against the dollar and is currently trading at Rs 55.10. Meanwhile, Brent crude continues to hover around the price of USD 110 per barrel while WTI crude is currently trading at USD 87.25 per barrel.

In conclusion, we expect the markets to remain volatile for the day and hence investors would do well to use caution.