Friday 22 January 2016

Sensex, Nifty to open on a positive note

The Nifty has been making a series of lower tops since March, which suggests that it is moving in a downward sloping channel with lower trendline support placed around 7200. US indices advanced on Thursday on the back of a recovery in crude oil prices. Dow climbed 0.7% and S&P 500 rose 0.5%.


A happy end to a tumultuous week appears to be in store. The name is Draghi, Mario Draghi; and the ECB Chief has for now provided the much needed relief rally to global markets. Draghi stated that Europe’s monetary policy will be reviewed and recalibrated in March as downside risks to the economy has increased due to the descent in oil prices and crisis emanating from the emerging markets, particularly China. The statement indicated a strong possibility of another round of quantitative easing. Meanwhile, ECB at its policy meet decided to keep the benchmark rate unchanged at 0.05%. The overnight deposit rate was also left unchanged at -0.3%

The outlook is a positive start. Early indications are indices could remain in the green for most part of the day if global cues provide support. The Nifty has been making a series of lower tops since March, which suggests that it is moving in a downward sloping channel with lower trendline support placed around 7200. Sharp corrections tend to provide choppy movement wherein index will have few days of uptick followed by few days of downtick. For now it looks like we will have an uptick.  Cairn India and ITC results will be in limelight among others.

Asian markets are mostly in the green. US indices advanced on Thursday on the back of a recovery in crude oil prices. Dow climbed 0.7% and S&P 500 rose 0.5%.

Finance Minister Arun Jaitley reportedly said it needs some additional growth engines and the focus now is on reviving private investments.

Minister of Petroleum and Natural Gas (I/C) Dharmendra Pradhan said that the present Indian government is keen to move towards a geographically diversified energy basket, and this has resulted in India’s greater focus on Africa as a vital region for sourcing petroleum products in coming years.

India's airlines may cut their cumulative losses by up to 72% this financial year said CAPA-Centre for Aviation.

Shares of Reliance Capital and Idea Cellular Ltd will be in focus. Reliance Capital Ltd posted a net profit after taxes, minority interest and share of profit of associates of Rs. 2350 mn for the quarter ended December 31, 2015 as compared to Rs. 2130 mn for the quarter ended December 31, 2014.

Reserve Bank of India Governor Raghuram Rajan has rejected Niti Aayog chief Arvind Panagariya's suggestion to raise the central bank's inflation target, according to reports. Rajan reportedly said that the current global market turbulence may owe much to central banks persisting with stimulus programmes for too long.

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