VantageTrade Eagle Eye: Markets bounced back on RBI announcement

For the second subsequent day, Nifty and Sensex were pulled down by weak global cues and growth concerns.  The taxes proposed by finance minister in the Budget which can come into effect soon also undermined investors’ sentiment. The market closed negative on the day of March expiries. Nifty fell 16 points at 5,178.85 and Sensex finished the session at 17,058.61, down 63 points.

The market has lost around 5% in March expiry against the 16% gain in January and 18% gain in February expiry. Foreign institutional investors were net sellers of shares amounting to Rs148.06 crore on Wednesday while domestic institutional investors were net buyers of stocks totaling Rs73.03 crore.

Asian shares were trading lower on Friday as investors are observing European Union economic and financial affairs ministers meeting in Copenhagen.  Japan's industrial production suddenly fell in February for the first time in three months in a sign foreign demand is slowing down. Japan's Nikkei 225 index was trading lower at 10,089.10 and Hong Kong's Hang Seng index was trading lower at 20,380.06, South Korea's Kospi index was trading lower at 2,011.50. China’s Shanghai index was trading slightly higher than previous close, at 2256.04.

US stocks closes mixed. The Dow Jones industrial average was up 19.61 points, or 0.15%, at 13,145.82. The Standard & Poor's 500 Index was off 2.26 points, or 0.16%, at 1,403.28. The Nasdaq Composite Index took off 9.85 points, or 0.31%, at 3,095.36.

Indian benchmarks started the first trading day of April series positive. Nifty was trading 27.75 point higher, at 5,208.60. Sensex opened at 17,117.41, 58.8 points higher.  RBI surprised the investors today by announcing that it will buy RS 10,000 crore worth bonds via open market operations. It boosted the sentiment and at 12 am Nifty was trading 41 points higher and Sensex rose by 150 points. The Indian rupee reacted by appreciating by 23 paise to 51.17 a dollar. Investors will observe Coal India’s shares as the company refused to follow the instructions of the Prime Minister to commit fuel supply to power stations for 20 years by March 31.

Other Economic and Political News:

-        February infra output up 6.8% yoy

-        Indian GDP to grow at 7.5% in FY2013: Fitch

-        Government will clarify stance on P-Notes taxation: Finance Minister

-        Tata Motors hikes commercial vehicle prices by up to Rs.60,000

-        Tata Motors to invest Rs.600cr on defense vehicles

-        NTPC to halt expansion of gas-based projects

-        Bharat Forge earmarks Rs.100cr to develop artillery gun

 

 

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