Monday, the Indian market is likely to open higher following a modestly positive closing on Wall Street Friday and a firm trend in the other Asian markets this morning. The U.S. futures are also trading higher, pointing to a firm opening on Wall Street Monday.
Currently, markets across the Asia-Pacific region are trading higher on growing optimism that the worst of the global economic crisis is over and the initiatives of the G-20 nations will yield positive results in the near term. Additionally, comments by U.S. Fed Chairman Ben Bernanke that the policies initiated to unclog the credit markets are showing positive signals are supporting the markets.
The Indian market is once again becoming an attractive investment destination for global investors. On a net basis, foreign funds purchased shares worth Rs.530 crore in March. Data provided by the US-based EPFR Global, which provides fund flows and asset allocation data to financial institutions, showed that emerging market equity funds witnessed net inflows of $1.2 billion for during the week ended April 1.
That said, the market might show volatility due to a shortened trading week. The market will be shut on Tuesday for Mahavir Jayanti and again on Friday for Good Friday. Uncertainty ahead of parliamentary elections and earnings announcement for the fourth quarter may also lead to profit taking.
In economic news, a survey by the industry chamber FICCI said that India's exports are likely to continue to head south in 2009-10 due to demand contraction in developed markets such as the U.S. and the European Union. More than 61% of exporters expect either a decline or flat growth in 2009-10, the survey said.
On Friday, the Dow Jones Industrial Average closed up 0.5%, the Nasdaq Composite rose 1.2% and the S&P 500 index moved up 0.97%. The Indian ADRs also closed mostly higher. Satyam Computers jumped 10%, Wipro surged up 5.76%, HDFC Bank advanced 2.63%, Infosys gained 1.57% and ICICI Bank rose 1.39%, but Sterlite Industries ended down 1.76%,
In Asian trading, crude oil is currently up 1.69% at $53.40 a barrel in electronic trading. Light sweet crude for May delivery closed down $0.18 at $52.46 a barrel on the New York Mercantile Exchange on Friday, after dismal employment report fueled concerns over energy demand.
Last week, after tumbling nearly 5% on Monday, the Indian market reversed its direction and ended higher for the third straight week boosted by firm global cues after a slew of economic data in the US gave investors hope that the worst might be over for the world's largest economy.
The BSE mid-cap and the small-cap indices outperformed the benchmarks. While the BSE Sensex closed at 10,348, up 300 points or 2.98% for the week, the S&P CNX Nifty rose 102 points or 3.29% to 3,211, the BSE mid-cap index soared 6.51% and the small-cap index jumped 6.13%.
Stocks to Watch
HCL Technologies may rise on reports that it has bagged a five-year IT services contract worth $170 million from software giant Microsoft.
Vishal Information Technologies may see some activity following reports that it has identified a couple of companies in the U.K. and Sweden for possible buyouts.
JBF Industries may see some activity after the company's board approved buy back and cancellation of foreign currency convertible bonds of $14.30 million at a 32.3% discount to the face value.
BHEL may see some buying interest on reports that its Ramachandrapuram unit achieved a 27% rise in its turnover to Rs.3, 934 crore in 2008-09 despite global recession and difficult financial conditions prevailing in the market.
Satyam Computers may rise after its ADR jumped 10% on Friday amid reports that four serious suitors have reached the final lap in the race to acquire a majority stake in the company.
Tata Motors could be in focus following reports that it has postponed plans for an overseas equity issue and sale of investments to repay the $3 billion bridge loan it took in June last year to acquire the Jaguar and Land Rover (JLR) brands from Ford.
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