The Indian markets despite showing some signs of recovery, could not keep the momentum going and extended their fall for the sixth straight day in last session, awaiting the outcome of the central bank's policy review, as well as the Federal Reserve's decision on tapering monetary stimulus. Today the start is likely to remain cautious and all eyes will be on Reserve Bank of India’s (RBI) mid-quarter review. The RBI is widely expected to raise its key repo rate by 25 basis points to eight percent, given the price rises at both the retail and wholesale levels. Traders will also watch the rupee movement ahead of the outcome of two-day US Federal Reserve meeting. The Indian rupee has slipped below the 62 level against the US dollar in last session. There will be buzz in capital goods stocks, as India’s exports of engineering goods has reported a sharp month-on-month fall of 14.60 percent in November as compared to the previous month. Sugar stocks too are likely to remain in action on reports that sugar output fell by 50 percent to 24.24 lakh tonnes so far in the 2013-14 season due to the delay in the sugarcane crushing operations especially in Uttar Pradesh. However, Food Minister K V Thomas has said that sugar production in the country, is expected to remain unaffected despite delay in commencement of sugarcane crushing. Apart from secondary market, there will be buzz from the primary market too, as the Capital market regulator Sebi is likely to come out with new rules on public issue of stocks where IPO grading by credit rating agencies should not be compulsory.
The US markets ended modestly lower in last session ahead of the announcement of the Federal Reserve's monetary policy decision. Trade remained directionless throughout much of the trading day and traders were reluctant to make any significant moves. The Asian markets have made a mixed start with some of the indices trading in red, while the Japanese market has surged over a percent in early deals, as the country saw a merchandise trade deficit of 1.292 trillion yen in November, beating forecasts for a shortfall of 1.351 trillion yen.
Back home, Tuesday’s trading session turned out to be a disappointing day of trade for the Indian stock markets as key equity benchmarks snapped the volatile session once again in the negative terrain, extending their losing streak to sixth day in a row. Though, both the frontline gauges made a positive start supported by firm global cues. But, markets failed to sustain the positive momentum as sentiments took a hit after investors turned cautious ahead of Reserve Bank of India’s (RBI) mid-quarter review of monetary policy for 2013-14, slated to be released on December 18, 2013. Earlier, sentiments remained up-beat after India Inc has raised hopes that spurt in inflation to a 14-month high of 7.52 percent in November should not come in the way of the Reserve Bank's formulating an accommodative monetary policy and has said that high interest rates at this stage may only worsen the industrial slowdown and not help ease inflation. Supportive cues from US markets and Asian markets too provided some support to local markets. However, sentiments got hurt after Indian rupee depreciated ahead of Fed’s decision on tapering of its monetary stimulus. The rupee was trading at 61.91/92 per dollar at the time of equity markets closing as against previous close of 61.73/74 per dollar. Selling in banking counter too dampened the sentiments. Stocks like HDFC Bank, State Bank of India, Indian Bank, Bank of Baroda etc. edged lower on expectation that RBI may hike its key policy rate by 0.25% tomorrow, the third straight increase under Governor Raghuram Rajan as part of the war against inflation. Additionally, the PSU oil marketing companies too will be under pressure as it has been reported that losses on diesel sales have climbed to Rs 10.48 per litre after international oil rates inched up. Finally, the BSE Sensex declined by 47.38 points or 0.23%, to settle at 20612.14, while the CNX Nifty lost 15.65 points or 0.25% to settle at 6,139.05.
The US markets ended modestly lower in last session ahead of the announcement of the Federal Reserve's monetary policy decision. Trade remained directionless throughout much of the trading day and traders were reluctant to make any significant moves. The Asian markets have made a mixed start with some of the indices trading in red, while the Japanese market has surged over a percent in early deals, as the country saw a merchandise trade deficit of 1.292 trillion yen in November, beating forecasts for a shortfall of 1.351 trillion yen.
Back home, Tuesday’s trading session turned out to be a disappointing day of trade for the Indian stock markets as key equity benchmarks snapped the volatile session once again in the negative terrain, extending their losing streak to sixth day in a row. Though, both the frontline gauges made a positive start supported by firm global cues. But, markets failed to sustain the positive momentum as sentiments took a hit after investors turned cautious ahead of Reserve Bank of India’s (RBI) mid-quarter review of monetary policy for 2013-14, slated to be released on December 18, 2013. Earlier, sentiments remained up-beat after India Inc has raised hopes that spurt in inflation to a 14-month high of 7.52 percent in November should not come in the way of the Reserve Bank's formulating an accommodative monetary policy and has said that high interest rates at this stage may only worsen the industrial slowdown and not help ease inflation. Supportive cues from US markets and Asian markets too provided some support to local markets. However, sentiments got hurt after Indian rupee depreciated ahead of Fed’s decision on tapering of its monetary stimulus. The rupee was trading at 61.91/92 per dollar at the time of equity markets closing as against previous close of 61.73/74 per dollar. Selling in banking counter too dampened the sentiments. Stocks like HDFC Bank, State Bank of India, Indian Bank, Bank of Baroda etc. edged lower on expectation that RBI may hike its key policy rate by 0.25% tomorrow, the third straight increase under Governor Raghuram Rajan as part of the war against inflation. Additionally, the PSU oil marketing companies too will be under pressure as it has been reported that losses on diesel sales have climbed to Rs 10.48 per litre after international oil rates inched up. Finally, the BSE Sensex declined by 47.38 points or 0.23%, to settle at 20612.14, while the CNX Nifty lost 15.65 points or 0.25% to settle at 6,139.05.
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