March 2009 derivatives to keep market volatile; Inflation data eyed

Key benchmark indices are likely to extend recent upmove on the back of positive global cues. The SGX Nifty futures for March 2009 series rose 12.50 points in Singapore. However volatility may remain high ahead of the expiry of March 2009 derivatives contracts for March 2009 series on Thursday, 26 March 2009. Inflation data in the year through 14 March 2009 to be released by noon today, 26 March 2009 will be closely watched.

As per reports, rollover of Nifty positions from March 2009 series to April 2009 was 65% while marketwide rollover stood at 63%, as on Wednesday, 25 March 2009.

Inflation data in the year through 14 March 2009 to be released by noon today, 26 March 2009 will be closely watched. Inflation based on the wholesale price index (WPI) rose 0.44% in the year through 7 March 2009, a record low for the current series, data released by the government during trading hours on Thursday, 19 March 2009, showed. The rate of growth in inflation was much lower than previous week's annual rise of 2.43%. Hopes of interest rate cut by the Reserve Bank of India (RBI) loom large to revive demand and fuel growth in a sagging economy.

Asian stocks rose today, 26 March 2009 lifting the region's benchmark index to a two-month high, as better-than- expected US economic reports fueled optimism that global growth is responding to government stimulus measures. Key benchmark indices in Hong Kong, China, Japan, Singapore, South Korea and Taiwan were up by between 0.16% and 2.34%.

US stocks advanced in a volatile session on Wednesday, 25 March 2009 as unexpected growth in durable-goods orders and new-home sales stimulated confidence the economy is improving. The Dow Jones industrial average rose 89.84 points, or 1.17%, to 7,749.81. The Standard & Poor`s 500 index rose 7.63 points, or 0.95%, to 813.88, while the Nasdaq Composite index rose 12.43 points, or 0.82%, to 1,528.95.

The US February 2009 new home sales increased by 4.7% to 337,000 compared with January 2009, as against an expected decline of 2.9%. Commerce Department's report showed durable goods orders rose 3.4% in February 2009 over the previous month to $165.6 billion, as against an estimated 2.5% fall.

Back home, key benchmark indices extended recent strong gains on Wednesday, 24 March 2009 as buying by foreign funds and higher US index futures bolstered sentiment. Expectations of a further cut in policy rates by the Reserve Bank of India (RBI) also aided the surge.

The BSE 30-share Sensex jumped 196.85 points, or 2.08%, to 9,667.90, its highest closing since 6 January 2009. The S&P CNX Nifty jumped 45.65 points or 1.55% to 2,984.35.

From a three-year closing low of 8,160.40 on 9 March 2009, the BSE Sensex has risen 1,507.50 points or 18.47%.

According to provisional data on NSE, foreign institutional investors (FIIs) were net buyers worth Rs 348.65 crore while mutual funds bought shares worth Rs 8.92 crore on Wednesday, 25 March 2009.