Markets To See A Negative Open As Europe Plays Spoilsport Again

After a really good run since the beginning of 2013, we are now in a phase where there is a spate of bad news hitting the market every other day. Yesterday,  Europe came back to haunt markets globally once again. Spain and Italy turned out to be the real culprits which triggered a sell off not just on the European shores but also hit the US markets.

Spanish Prime Minister Mariano Rajoy has been mired in a major controversy involving him having accepted bribes. The oppositions call for his resignation has sent clear signs of instability once again rocking the European region. On the other hand Italy partnered Spain in destabilizing the European region after reforms implemented there are being viewed to be at risk thanks to the increasing popularity of Silvio Berlusconi, the former Prime Minister to be a strong contender in the elections slated to be held end of this month.

The Indian markets had already seen the impact of an unstable Europe in the later part of yesterday’s trading. With the overnight reaction of the US markets to the European conundrum being almost similar, there is little hope on what good the Indian markets could do today. The early signs are already visible from the way its Asian peers have opened and are trading today. There is not one single market across the whole of Asia which is showing even the remotest sign of green. Markets are down an average 0.60% this morning with Hong Kong, Korea and Japan being the worst. China, Taiwan, Singapore, Indonesia and Malaysia haven’t been doing any better with the only difference being in the quantum of losses that they have registered.

Back in India, yesterdays corporate score card too hasn’t been really good. Weak results from Bank of Baroda have been ticked off by the market as a precursor to the end of good corporate performances that could come your way for the December quarter. Investors’ will now keep a rather hawkish eye on the remaining set of companies that will announce their numbers for the December quarter. Frontline companies are almost done with their results and the remaining will hardly matter to the broader market. This is precisely the reason, why the focus will now once again shift to macro issues. Having said that, the cues emerging from global economies aren’t really looking good and this could mean a pull back from the higher levels at least for now.

While the US markets have come off their five-year highs, Asian markets too have given up their rise and are trading very weak. It does not take any rocket science to predict the market on such a day. The SGX Nifty is already pointing towards where the Indian markets are headed today. It is trading down by almost 20 points and this means a rather weak opening to go with. The day could be one of those where nothing can probably come to pull the markets out of the rut. Psychologically traders and investors are bound to have a negative bias for today and this could see the market trade in the red throughout.

While we keep you posted on the happenings in the market throughout the day, do have a look at what the technicals indicate for the Nifty along with the stocks that are likely to remain in action for today.