Market watch: Cues that will impact first day of Oct series

The Indian market closed marginally lower on settlement day on Thursday. But the series gone by was quite strong due to consistent inflow of foreign money. The Sensex fell 52.67 points to close at 18,579.50. Meanwhile, the Nifty declined 13.95 points and ended at 5,649.50 after a volatile trade. The October series will begin from today.

A quick look at global and local cues.

SC verdict:

In a major relief for the government, the Supreme Court on Thursday clarified that the auction order in the 2G scam was only restricted to telecom spectrum and not for all natural resources.

Also read: Judiciary has right to scrutinise policy decisions, say experts

Government borrowing programme:

The government has said that there will be no hike in the borrowing target for FY13. It also said that all efforts are on to meet the FY13 fiscal deficit target.

US markets:

The US markets finished higher, with the S&P 500 breaking a five-day losing streak, after Spain unveiled its economic reform plans and amid optimism that China's government would provide additional stimulus.

Major indices are poised to log strong gains for the quarter, with the Dow up nearly 5 percent and the S&P and Nasdaq up more than 6 percent each.

The CBOE volatility index tumbled below 15.

US economic data front:

The US economy expanded at a tepid 1.3 percent annual rate, the slowest pace since the third quarter of 2011. Adding to woes, durable goods orders slumped by the most in three-and-a-half years in August.

Pending home sales dropped in August due to a supply shortage. Weekly jobless claims for the week ended September 22 fell to a seasonally adjusted 359,000.

Key data to watch out for in US today:

Personal income is expected to come in at 0.2 percent, while consumer spending may come in slightly higher at 0.5 percent. Also watch out consumer sentiment data.

European markets:

European markets ended marginally higher lifted by expectations for economic stimulus in China.

Spain announced a crisis budget for 2013 based mostly on spending cuts. Ministry budgets were slashed by 8.9 percent for next year and public sector wages frozen for a third year as Prime Minister Mariano Rajoy battles to trim one of the euro zone's biggest deficits. The budget could be seen as an effort to pre-empt the likely conditions of an international bailout.

Greek coalition government has agreed nearly 15 billion dollars in spending cuts over the next couple of years. The government is hoping that this will satisfy worldwide lenders and keep bailout funds coming. The finance minister will meet representatives from The troika next week who have the final say on the cutbacks.

Asian markets:

At 7: 45 am (IST), Asian markets were trading firm. China's Shanghai Composite was flat at 2,056.97. Hong Kong's Hang Seng was up 0.21% or 43.88 points at 20,806.17. Japan's Nikkei was down 0.36% or 31.93 points at 8,917.94.

Singapore's Straits Times was up 0.34% or 10.40 points at 3,069.83. South Korea's Seoul Composite was up 0.11% or 2.09 points at 1,990.79. Taiwan's Taiwan Weighted was flat at 7,677.57.

Currency space:

The euro held firm as worries about the Euro zone eased somewhat after Spain unveiled a crisis budget.

Commodities:

Brent crude prices rose more than 2 percent to USD 112 per barrel levels as tensions between Iran and the West reinforced concerns about potential supply disruptions.

Gold prices jumped 1 percent yesterday on hopes for additional monetary stimulus from China. Currently, it is around USD 1,776 an ounce.

Stocks in news:

The Group of Ministers formed to formulate the new drug pricing policy has finalised a proposal on the issue. The matter will now be put up before the Cabinet for its approval. The GoM was looking into issues related to regulating prices of 348 drugs.

Subex will be in focus today as Subhash Menon resigns from post of MD and CEO. However, he will continue to be non independent director of the company.

Kingfisher is another stock to watch in trade as both NSE and BSE seek clarifications from the company on reports that the carrier is in talks with foreign entities and domestic investors for stake sale. Reports indicate that Dubai carrier Emirates is believed to have signaled an early interest to acquire a stake in the troubled company with riders.

Lanco Infra will sell stake in power, real estate business and would be completely exiting B-O-T road projects.

Vini Amesar.
Vini.amesar@network18online.com