Markets to get a flat start, may move higher in latter part of trade

The Indian markets dashing all hopes of recovery plunged further in last session and both the benchmarks ended lower by around a percent. Today, the start is likely to be flat-to positive on good global cues, and traders will be reacting to the better than expected results of number one IT company TCS, announced after the market hours. The company has reported stellar performance due to growth and deal wins in Europe and Asia Pacific region and investments in digital technologies. Apart from equity, money markets too are likely to remain in action, as the Reserve Bank of India (RBI) has asked the Fixed Income Money Market and Derivatives Association of India (FIMMDA) and the Foreign Exchange Dealers’ Association of India (FEDAI) to act as administrators of the Indian rupee interest rate and foreign exchange benchmarks. There will be some buzz in the coal and mining sector stocks, as an Inter-Ministerial Committee (IMC) will be meeting to discuss “whether bidders should be allowed to take sample of coal from Central Coalfields (CCL) to perform the yield analysis of Jhirki coal block.” The IMC in its meeting will also look at “when the coal will be considered surplus. If it is beyond 80 percent of demand or beyond 100 percent of demand.” PSU oil marketing companies are likely to get some relief, as the loss on sale of diesel has been trimmed by 44 paise to Rs 5.49 a litre after appreciation in the value of the rupee made imports cheaper. The US markets extending their gains for the third straight day ended sharply higher in last session, on the back of positive remarks by Federal Reserve Chairman Janet Yellen who insisted again that the Fed will remain highly accommodative until employment and inflation reach healthier levels. Asian markets have made a mixed start though some of the indices are trading higher taking cues from the US markets. Chinese market was marginally in red, as the Premier Li Keqiang said China isn’t considering "strong" stimulus. Back home, extending the southward journey for third straight session, distressed markets clobbered out of shape in Wednesday’s trade with benchmarks ending the session with a cut of around a percentage point and frontline gauges tumbled below their crucial 6,700 (Nifty) and 22,300 (Sensex) levels. Selling was both brutal and wide based as none of the sectoral indices, barring metal and FMCG on BSE were spared. Those counter which featured in the list of worst performers, included software, technology and capital goods. Earlier, markets made a flat but positive start but reversal of trend, which took place in second half of trade due to caution surrounding foreign institutional investors (FIIs) outflows, mainly weighed down sentiments. Further, muted Q4 growth expectations from TCS which will announce its earnings after market hours further dampened sentiments. Investors also remained cautious on rise in CPI numbers dashed hopes of any rate cut for India Inc. The inflation concern is likely to linger further with a private forecast that India should prepare for below normal rainfall in the crucial monsoon season this year, particularly in the agriculturally significant north-western and western central regions. The markets cracked further in noon trades, ignoring the positive cues from the global bourses. While, Asian markets ended mostly in the green after China reported economic growth a touch above forecast, European stocks made a firm start. Back home, domestic bourses continued to trade in the red after Indian rupee depreciated against dollar. The rupee was trading at 60.36 per dollar at the time of equity markets closing versus its previous close of 60.24 per dollar. Meanwhile, the information technology pack witnessed immense selling pressure, ahead of the Q4 results from Wipro and TCS. Infosys tumbled over three percent on investor concerns about the company’s ability to bag lucrative contracts due to high attrition rate in the January-March quarter even as it posted a higher-than-expected net profit for the period. Finally, the BSE Sensex plunged by 207.70 points or 0.92%, to settle at 22277.23, while the CNX Nifty declined by 57.80 points or 0.86% to settle at 6,675.30.