Markets to remain in jubilant mood on sanguine global cues

The Indian markets bounced back in last session and recovered their previous session losses with buying returning in high beta stocks. Today, the start is likely to remain positive and the indices will strengthen taking cues from global markets. Meanwhile, industry body Assocham in its action plan for the new government has pitched for liberalisation of ECB norms, GST implementation, incentives for investments and easing of processes for companies planning to set up manufacturing units. While, the disinvestment department has said that the new government could look at the possibility of strategic sale of state-owned enterprises in the non-core sectors like steel and cement. There is also likely to be buzz in the markets, with regulator Sebi allowing fund houses to accept investments up to Rs 50,000 per person per year in cash in order to bring in more investors into the mutual fund (MF) sector. Traders will also be eyeing the movement of rupee which witnessed its biggest single-day rise in nearly a week on a report that finance ministry was working on a proposal to cut fiscal deficit. Exporters and gold related stocks are likely to continue their jubilation after RBI permitted exporters, long-term export advance up to a maximum period of 10 years on a satisfactory track record and eased gold import norms. There will be lots of important result announcements too, to keep the markets buzzing. Anuh Pharma, Bosch, Colgate Palmolive, Dhanlakshmi Bank, Engineers India, HDIL, ITC, Lanco Infra, Mcleod Russel, MOIL, Neyveli Lignite, SBI, Sun TV Network etc will announce their numbers. The US markets remained in jubilant mood and extended their gains for yet another day and the Nasdaq managed to reach its best closing level in a month, after the release of a report from the National Association of Realtors showing that existing home sales rose for the first time this year in April. The Asian markets have made a strong start and Japanese market was riding high, as yen declined near a one-week low. Back home, resuming northward journey after a day of pause, Indian equity benchmarks ended the session with a gain of around one third of a percent, supported by firm performance of realty and consumer durables sector, although markets gave up large amount of gains towards the close as investors booked profits at higher levels. Overall, sentiments remained up-beat after UN World Economic Situation and Prospects (WESP) 2014 mid-year update, said that India’s economy would grow by 5 percent in 2014 and 5.5 percent in 2015  on stronger consumption and investment, up from 4.8 percent in 2013 and 4.7 percent in 2012. Supportive cues from US markets provided much needed support to local markets and sentiments remained up-beat on hopes of continued robust foreign buying in equities and debt after minutes of the U.S. Federal Reserve’s last meeting backed bets of a slower withdrawal of the stimulus. Asian markets ended mostly in the green. Back home, there was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too participated in the rally. Meanwhile, the finance ministry was reported to propose a new plan for the incoming government for further fiscal consolidation. According to reports, the new plan which proposes to cut subsidies and welfare spending will reduce the current year’s fiscal deficit and save Rs 25,000 crore in borrowing. Jewellery makers like Titan Company, Gitanjali Gems, PC Jeweller, Thangamayil Jewellery, Tribhovandas Bhimji Zaveri edged higher after the Reserve Bank of India (RBI) eased gold import rules by allowing select trading houses, in addition to already permitted banks, to procure the precious metal to boost exports. Additionally, Coal India surged to hit 52-week high on reports that the newly elected PM designate Narendra Modi is exploring to break up the company and opening up the sector to foreign investment. Finally, the BSE Sensex gained 76.38 points or 0.31%, to 24374.40, while the CNX Nifty was up by 23.50 points or 0.32%, to 7,276.40.