With Hardly Any Trigger – Expect A Flat Opening

The last expiry of the year 2013 was good for the markets as the indices closed on a high. Everyone on the street had expected it to be a volatile one, however to the contrary it remained range bound throughout the session. With hardly any major trigger on the domestic front the Indian markets were directly taking a cue from the global markets. Today also the Indian equities are expected to dance to the tune of global news flow.

On the global canvas there are few positives like the US jobless claims data providing positive news. The number of Americans filing new claims for unemployment benefits fell last week to the lowest level in nearly a month, a hopeful sign for the labor market. Initial claims for state unemployment benefits decreased 42,000 to a seasonally adjusted 338,000, the Labor Department announced on Thursday. While recent data on claims have been clouded by seasonal volatility around the winter holiday period, Thursday's report showed claims in a range that supports expectations for faster economic growth next year. This is a major positive sign for the market as faster economic recovery in the US economy would provide a much needed impetus to the global markets. The U.S. data has been coming in quite strong since the Fed decided to start tapering, while the market has expectations that in Japan stimulus could be increased. The yen weakened to a five-year low on speculation the Bank of Japan will sustain monetary easing, while falling U.S. jobless claims bolstered confidence in the Federal Reserve’s decision to taper stimulus. Impact of this is clearly seen from the fact that globally the equity indices are trading at yearly high. And we expect the indices to remain at higher levels in near term.

As regards the performance of global indices yesterday, the Dow continued its upward march and close higher by 0.74 %. Even the NASDAQ closed on a positive zone.

As for the Asian markets, Only Nikkei is trading in red with all other indices witnessing marginal gains. The SGX nifty is trading in negative zone, Down 24 points at 6326. While there is hardly any major trigger on the domestic front, the rumors suggest that the Government may reduces the import duty oj gold by 2 %. If that is announced today, the stocks like Titan, TBZ and other importers would be benefited.

All in all we expect the markets to open on a flat note and then remain range bound.