The 50-share Nifty index is expected to open flat to lower on Wednesday tracking weak Asian Markets but markets are expected to remain rangebound as investors await Reserve Bank of India's policy meet on Thursday.
Higher inflation numbers along with rate hike fears will keep investors at bay as the Reserve Bank of India echoed intentions of arresting inflation at the cost of growth which stoked fears of further rate hike in the coming policy meet on June 16, Thursday.
According to a Reuters Poll, the Reserve Bank of India (RBI) is expected to raise its repo rate by a total of 75 basis points for the rest of 2011, including a 25 basis point increase on Thursday.
Market had yet another lackluster session on Tuesday even as inflation and upcoming RBI review continues to weigh on sentiment.
Inflation for the month of May rose higher than expected with slower growth in fuel and food cost thus adding pressure on India's Central Bank to lift interest rates this week despite and compromise on growth.
The wholesale price index rose an annual 9.06 percent in May. Annual manufacturing inflation in May was 7.27 percent, up from 6.18 percent in April, while annual fuel price inflation eased to 12.32 percent from 13.32 percent in April despite an increase in domestic gasoline prices in mid-May.
Markets are likely to continue to trade in a narrow band between 5480 and 5580 for the next few sessions untill they break out above their near term resistance of 5580 on the Nifty charts.
"Nifty can gain some altitude going forward but to be able to do that it must clear this hurdle at 5580 which has thus far proven quite a challenge", says Kunal Saraogi, CEO, Equityrush.
Strong moves in the banking space on Tuesday indicates that possibly markets may well be gearing up to take another stab at this very crucial resistance, adds Kunal.
Pharma, FMCG, banking, textiles continue to better the markets and auto and metals are likely to be the laggards.
US stocks posted their biggest gains in nearly two months on Tuesday as retail sales figures eased fears of overheating of the economy.
The Dow Jones industrial average gained 123.14 points, or 1.03 percent, to 12,076.11. The Standard & Poor's 500 Index rose 16.04 points, or 1.26 percent, to 1,287.87. The Nasdaq Composite Index advanced 39.03 points, or 1.48 percent, to 2,678.72.
In China, consumer prices rose at their fastest pace in almost three years in May, but industrial output grew from a year ago. China's central bank increased the reserve requirement ratio for commercial lenders by 50 basis points.
Brent crude oil rise $1.04 to $121.20 a barrel in early trade on Wednesday after US oil inventories showed a larger-than-expected drop for the second straight week according to a report.
At 07:47 AM, The Nifty India stock futures in Singapore were trading flat.
Stocks to watch
Steel manufacturing stocks will be watched after the Steel Ministry on Tuesday said that 7.1 lakh tonnes of iron and steel will be allocated in the current fiscal to small-scale industries (SSIs) and other government departments.
Higher inflation numbers along with rate hike fears will keep investors at bay as the Reserve Bank of India echoed intentions of arresting inflation at the cost of growth which stoked fears of further rate hike in the coming policy meet on June 16, Thursday.
According to a Reuters Poll, the Reserve Bank of India (RBI) is expected to raise its repo rate by a total of 75 basis points for the rest of 2011, including a 25 basis point increase on Thursday.
Market had yet another lackluster session on Tuesday even as inflation and upcoming RBI review continues to weigh on sentiment.
Inflation for the month of May rose higher than expected with slower growth in fuel and food cost thus adding pressure on India's Central Bank to lift interest rates this week despite and compromise on growth.
The wholesale price index rose an annual 9.06 percent in May. Annual manufacturing inflation in May was 7.27 percent, up from 6.18 percent in April, while annual fuel price inflation eased to 12.32 percent from 13.32 percent in April despite an increase in domestic gasoline prices in mid-May.
Markets are likely to continue to trade in a narrow band between 5480 and 5580 for the next few sessions untill they break out above their near term resistance of 5580 on the Nifty charts.
"Nifty can gain some altitude going forward but to be able to do that it must clear this hurdle at 5580 which has thus far proven quite a challenge", says Kunal Saraogi, CEO, Equityrush.
Strong moves in the banking space on Tuesday indicates that possibly markets may well be gearing up to take another stab at this very crucial resistance, adds Kunal.
Pharma, FMCG, banking, textiles continue to better the markets and auto and metals are likely to be the laggards.
US stocks posted their biggest gains in nearly two months on Tuesday as retail sales figures eased fears of overheating of the economy.
The Dow Jones industrial average gained 123.14 points, or 1.03 percent, to 12,076.11. The Standard & Poor's 500 Index rose 16.04 points, or 1.26 percent, to 1,287.87. The Nasdaq Composite Index advanced 39.03 points, or 1.48 percent, to 2,678.72.
In China, consumer prices rose at their fastest pace in almost three years in May, but industrial output grew from a year ago. China's central bank increased the reserve requirement ratio for commercial lenders by 50 basis points.
Brent crude oil rise $1.04 to $121.20 a barrel in early trade on Wednesday after US oil inventories showed a larger-than-expected drop for the second straight week according to a report.
At 07:47 AM, The Nifty India stock futures in Singapore were trading flat.
Stocks to watch
Steel manufacturing stocks will be watched after the Steel Ministry on Tuesday said that 7.1 lakh tonnes of iron and steel will be allocated in the current fiscal to small-scale industries (SSIs) and other government departments.
No comments:
Post a Comment