Indian markets likely to open on a positive note following the supportive global cues. Easing domestic retail inflation and fall in long term bond yields may give rise to expectations of a rate cut by RBI. Technically, the resistances are placed at 8210 and 8280 and supports are at 8050 and 7950.
India Market News
In a departure from the norm, the government has decided to present the Union Budget for FY18 on February 1, 2017. In the past, Budget has been presented on the last working day of February. The move is aimed at expediting implementation of various schemes beginning March 1, 2017.
India's benchmark bond yield dipped to a nearly seven-and-a-half year low of 6.53%, the lowest level since May 2009, pushing up prices, as investors rushed to buy debt securities amid renewed rate-cut hopes triggered by the government's demonetization move to curb black money.
Easing food and fuel prices helped pull down retail inflation to 14-month low of 4.2% percent in October this year. The previous low of 3.7% was recorded in August last year. The Consumer Price Index (CPI) based inflation was 4.4% in September this year, an upward revision from previous official record of 4.3%. The Consumer Food Price Index was down at 3.3% compared with 3.9% fall in September.
Petrol price has been cut by INR 1.46 per litre and diesel by INR 1.53 per litre, reversing the rising trend of the past few weeks. The reduction in rates announced by Indian Oil Corporation , the nation's biggest fuel retailer, is excluding state levies (VAT) and the actual cut will be higher after considering them.
India's trade deficit in October 2016 widened to USD 10.16bn compared with USD 8.34bn in the previous month as gold imports more than doubled to USD 3.5bn from a year ago, government data showed on Tuesday. Merchandise exports grew 9.6% y/y to USD 23.5bn in October, while imports expanded 8.11% y/y to USD 33.67bn, the data showed.
In a respite to farmers in the top wheat growing states of Punjab and Uttar Pradesh, the Union cabinet on Tuesday approved a modest 6.6% hike in the minimum support price (MSP) of wheat, the main spring harvest for which planting has begun.
Kotak Mahindra Bank has reduced the interest rate on one-year fixed deposits (FDs) by 25 basis points (bps) to 7%, lower than 7.05% offered by the State Bank of India (SBI) on deposits of the same tenure. The new rate had come into effect on Monday.
Today's Corporate action
Ex - Dividend: Gujarat Pipavav Port Ltd, PI Industries Ltd, Marico Ltd
Global Markets Review
Asian stocks are trading with gains on Wednesday morning taking cues from a positive close by US markets. European markets too closed in the green. Positive economic data and US bond rally helped positive sentiments revive in the global markets.
The oil prices hovered near their highest levels in about two weeks after having jumped c.6% on Tuesday on bets OPEC members will agree to cut output when they meet later this month. US crude futures stood at USD 45.67 per barrel, after having risen to USD46.09 late on Tuesday, their highest since November 2, 2016.
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