Monday, the Indian market is likely to open higher on the back of favorable Asian cues following encouraging economic data and a strong close on Wall Street last Friday.
The major U.S. averages gained between 1.2%-1.4% on Friday after a Labor Department report showed that the pace of job losses slowed by even more than economists had been anticipating in the month of July. The Labor Department also said that the unemployment rate unexpectedly edged down to 9.4% in July from 9.5%, recording a decrease for the first time since April 2008.
Currently, the other Asian markets are trading mostly higher, with the Japanese Nikkei trading past the 10,500 mark for the first time in ten months.
Back home, trading could be largely stock-specific as investors churn their portfolios in favor of 'value' buys that promise significant upsides from current levels. Especially, mid-caps and small-caps are likely to receive more buying support compared to large-caps. However, worries on the monsoon front could lead to some intermittent profit taking.
Oil prices turned notably lower on Friday after giving back an early rally amid lingering demand worries. A stronger U.S. dollar also lowered the hedge appeal of commodities. Light sweet crude for September dropped to $70.93 per barrel, down $1.01 per barrel. In Asian trading on Monday, crude oil price retreated further to $70.85 per barrel.
Last week, a set back in the last two sessions pulled down the benchmark indexes, the Sensex and the Nifty, by around 3.3% each. Concerns over scanty rains and worries about liquidity due to the opening of the Rs.6,000 crore NHPC IPO weighed on market. Despite some selling in the last two days, net purchases by FIIs during the week totaled Rs.1,695 crore. FMCG and Realty stocks bore the brunt of the selling pressure, but oil/gas stocks ended firm following favorable movement in the crude oil price.
Stocks to Watch Bharti Airtel is likely to offer more cash and fewer shares to sweeten a $23 billion merger with South Africa's MTN, reports said.
National Thermal Power Corporation (NTPC) is in discussions with the Federal Government of Nigeria for setting up coal and gas based power plants in Nigeria and Sri Lanka, reports said.
Representatives of private airlines, including Kingfisher and Jet Airways are likely to meet the Civil Aviation Minister Praful Patel on Monday to hold dialogue to resolve the problems faced by the civil aviation sector.
Maruti Suzuki could be in the spotlight after 11 European countries withdrew the scrappage incentive scheme, which offers car owners a subsidy ranging from euro 750 to euro 4,000 to replace their older, polluting vehicles with low-emission and fuel-efficient ones.
TCS, Wipro and Infosys are reinforcing their product line, changing product offerings and have modified their strategy to focus on recession-proof sectors like pharma and healthcare, education, telecom and utilities to beat the slowdown, reports suggest.
Kinetic Motor's board has decided to allot 56,00,000 optionally convertible cumulative preference shares to Micro Age Instruments Pvt., a promoter group entity, at a price of Rs.14.20 on a preferential basis.