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Last Updated : Feb 28, 2017 09:14 AM IST | Source: Moneycontrol.com

Market may open higher on global cues; Trump speech awaited

Global investors await key speech from US President Donald Trump to the joint session of the Congress; chances are likely that the President announces tax cuts and infra spending decisions as well. Back home, investors will await cues for the key GDP data as well.

After snapping a six-day rally on Monday, the market could see a mildly positive opening on Tuesday, tracking gains in the global markets. The Street will also eye the key domestic GDP data that will be released later in the day. Trends on SGX Nifty show flat opening with a positive bias.

Asian markets are mostly higher this morning tracking US gains, as investors wait for the key speech from US President Donald Trump. He will be speaking at a joint Congress session later in the day. Japanese market is trading in the green with gains of over half a percent, while the yen weakened. Kospi was marginally higher, up about a tenth of a percent, while the Singapore Straits was trading lower.

In the US, equities closed slightly higher as Wall Street looked ahead to a key speech from Trump. Investors will look for clues about the administration's plans for tax reform and deregulation.

In Europe, markets ended on a mixed note as investors digested more earnings, and kept an eye on the USD 31 billion London Stock Exchange-Deutsche Boerse merger which appeared to show signs of unraveling.

Back home, equity benchmarks snapped six-day winning streak, with the Nifty closing below 8900-mark due to profit booking in banks, telecom and auto stocks. However, the consistent rally in index heavyweight Reliance Industries capped losses.

The 30-share Sensex slipped 80.09 points to 28,812.88 and the 50-share Nifty fell 42.80 points to 8,896.70 amid consolidation. However, the broader markets outperformed benchmarks despite weak breadth, closing flat with a positive bias.

The Street will await key gross domestic product (GDP) data which will be released from the government later in the day. A CNBC-TV18 poll has pegged the FY17 GDP at 6.8 percent against 7.9 percent year on year.

Among stocks to watch could be ONGC, RBL Bank, Bharti Airtel, among others. Oil and Natural Gas Corp (ONGC) may well be looking at a cash outgo of at least Rs 44,000 crore if the government asks the oil and gas explorer to acquire stake in oil refiner Hindustan Petroleum Corporation Limited (HPCL). The cash outgo will go towards acquiring the government holding and buying an additional 26 percent stake in HPCL via an open offer.

Meanwhile, the newly-listed RBL Bank is also said to be interested in exploring a merger with Bharat Financial, sources with direct knowledge of the development said. IndusInd has been negotiating deal valuations with Bharat Financial, reported CNBC-TV18 quoting sources. RBL’s interest will increase competition for IndusInd Bank, they said.

Telecom space may be in focus as well. Bharti Airtel, meanwhile, fired a fresh salvo in the tariff war on Monday. The telecom major abolished roaming charges on voice calls, SMS and data along with announcement of international roaming packs as well. Tata and DoCoMo will reportedly announce a resolution to their dispute today.

The dollar was slightly weaker against a basket of currencies as investors were wary that Trump’s speech may not provide many details of his economic agenda.

Oil prices were trading flat after investors showed record confidence that prices would rise further, but the prospect of faster growth in US oil output capped gains. Gold prices recovered to near three-and-a-half month high as investors also awaited details Trump's policy stance.

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First Published on Feb 28, 2017 08:24 am
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