Market may fall tracking weak global cues

The key benchmark indices may decline tracking weak global cues as investors may book profits after recent surge in indices. Volatility may remain high today as traders roll over positions in the derivatives segment from August 2009 series to September 2009 series, ahead of the expiry the August 2009 contracts today, 27 August 2009.

The market will keenly watch foreign trade policy to be announced by the Commerce Minister Anand Sharma today. The Foreign Trade Policy is widely expected to contain sops for labour intensive sectors like gems and jewellery, textiles and leather. India's exports in the last 10 months have been sliding steadily by more than 25 per cent.

Key benchmark indices extended gains for the fifth day in a row on Wednesday, 26 August 2009. The BSE 30-share Sensex was up 81.38 points or 0.52% to 15,769.85 on Wednesday. The market has surged in the past five days supported by positive global cues. The BSE Sensex has risen 960.21 points or 6.48% in the past five trading days till Wednesday.

As per provisional data, foreign funds on Wednesday, 26 August 2009, bought equities worth a net Rs 378.54 crore. Domestic funds mopped up stocks worth a net Rs 128.65 crore

India's infrastructure sector output grew 1.8 % in July 2009 over July 2008, lower than an upwardly revised 6.8 % in June 2009, government data showed on Wednesday Output had risen 5.1 %in July 2008. The infrastructure sector accounts for 26.7 % of India's industrial output.

On Tuesday, Finance Minister Pranab Mukherjee said the economy could grow around 6 % in the year to March 2010, lower than the 6.7 % growth in 2008/09 and after expanding 9 percent or more in the previous three fiscal years.

The widely watched wholesale price index fell 0.95 % in the 12 months to 15 August 2009, its 11th successive fall compared to a 1.53 % decline in the prior week. The food articles index surged 13.3 % from a year earlier as drought has hit nearly half of India's districts, eroding crop production and raising major headaches for policy makers. The government announced the data after market hours on Wednesday.

Asian stocks declined today led by commodity companies, after China's government said it may curb overcapacity in the steel and cement industries, as well as strengthen controls of stock and bond sales. The key benchmark indices in China, Hong Kong, Japan, South Korea, Singapore and Taiwan fell by between 0.04% to 1.59%.

The US markets ended flat on Wednesday, 26 August 2009 as investors shrugged off encouraging economic reports. The Dow rose 4.23 points, or 0.04%, to 9,543.52. The S&P 500 index added 0.12 points, or 0.01%, to 1,028.12, while the Nasdaq Composite Index rose 0.20 points, or 0.01%, to 2,024.43.

In economic news, new-home sales shot up 9.6% in July to 4 lakh 33 thousand units. The number blew past economists' expectation for a 1.6% increase. Meanwhile another report showed mortgage applications jumped 7.5%.