No firm decisions!

Indecision is like a stepchild: if he does not wash his hands, he is called dirty, if he does, he is wasting water.

Recent gains could water down as the market comes to terms with indecisiveness and intra-day gyrations ahead of the F&O expiry. The 10-year benchmark bond yield ended at 7.30% on Tuesday and the Finance Minister’s tone seems to suggest he is trying to talk up the stock market and cool down the bond market.

While it has started pouring in many places, the adverse fallout from the delayed and disappointing rains could be much wider, deeper and longer. Inflation will be the biggest concern going forward. Interest rates too have bottomed out. We see a flat to cautious start and the usual dash of volatility for the day.

Meanwhile, the primary market seems to be gradually coming back to life after a protracted hiatus. It could have some impact on the secondary market, if there are too many issues. We are not talking about the IPOs only. There are other issues as well, like NCDs, GDRs, ADRs and QIPs. Liquidity could switch sides.

From consumer confidence to consumer sentiment, the global markets will tune in to a host of data from US. Stay tuned.

Wednesday brings reports on new home sales and durable goods orders in the US, both from the Commerce Department. The weekly crude oil inventories report from the Energy Information Administration is also due in mid morning.

FIIs were net sellers at Rs2.59bn in the cash segment on Tuesday on a provisional basis while the local funds pumped in Rs4.36bn, according to figures published on the NSE's web site. In the F&O segment, the foreign funds were net buyers at Rs3.33bn. On Monday, FIIs were net buyers at Rs8.48bn in the cash segment. Mutual Funds were net buyers of Rs4.16bn in the cash segment on the same day.

US stocks advanced on Tuesday, extending the recent rally, after reports showed that consumer confidence and home prices are starting to recover. Treasuries gained as crude oil fell more than $2 a barrel to the lowest price in a week.

News that President Obama is nominating Federal Reserve chairman Ben S. Bernanke for a second term in office added to the positive sentiment.

The Dow Jones Industrial Average added 30 points, or 0.3% to close at 9,539.29, its highest point since Nov. 4. The S&P 500 index gained 2 points, or 0.2% to end at 1,028.00, its highest point since Nov. 6. The Nasdaq Composite index rose 6 points, or 0.3%, to 2,024.23, the highest close since Oct. 1.

Stock gains were pretty broad based, with 21 of 30 Dow stocks rising.

US stocks had slipped on Monday as investors decided to take some profits home after pushing the major benchmarks to new 2009 highs on Friday.

But falling oil prices cut into any stock gains, dragging down the influential energy sector. The Amex Oil index was off 1%.

Since bottoming at a 12 1/2 year low on March 9, the S&P 500 is up 52% as of Tuesday's close. The pace and breadth of the run up has left many market players calling for a big selloff in September and October. But so far, there has been no indication of that.

Stocks hit the highs of the day just after the release of the August Consumer Confidence index. The index rose to 54.1, surprising economists who thought it would rise to 47.9. The index stood at a revised 47.4 in July.

Unemployment is continuing to rise, and that's going to keep the consumer spending in check for the time being. Inventory rebuilding will help support the US economy in the short term, rather than a spike in consumer spending.

President Obama nominated Bernanke to chair the Federal Reserve for a second term, announcing the reappointment months ahead of the expiration of Bernanke's current term. The reappointment is expected to receive the approval of the Senate.

Home prices rose 2.9% in the second-quarter versus the first quarter, according to an S&P/Case-Shiller report. That's the first quarterly rise in prices in three years and could signal that the housing market has bottomed.

The 20-city index declined 15.4% in June versus a year ago, but that was shy of forecasts for a drop of 16.4% versus a year ago.

The White House released its deficit and economic forecast. It predicts a federal budget deficit of $9 trillion over the next decade and a deficit of $1.58 trillion in 2009. The $9 trillion is $2 trillion more than what the administration had forecast previously.

The Congressional Budget Office released its own forecast shortly after the Obama administration. The CBO said that the 2009 deficit will total $1.6 trillion.

US light crude oil for October delivery fell $2.32 to settle at $72.05 a barrel on the New York Mercantile Exchange, after touching a new 10-month high in the morning.

Treasury prices inched higher, lowering the corresponding yields, following a positive response to the first of three government debt auctions this week. The rise in prices lowered the yield on the benchmark 10-year note to 3.44% from 3.47% on Friday.

Treasury sold $42 billion of 2-year notes Tuesday and is planning to sell $39 billion of five-year notes on Wednesday and $28 billion of 7-year notes on Thursday.

COMEX gold for December delivery rose $2.30 to settle at $946 an ounce.

In currency trading, the dollar rose versus the euro and gained versus the Japanese yen.

European shares too edged higher, notching a fresh annual high in the process, as gains for telecom stocks offset losses for miners. The Dow Jones Stoxx 600 index rose 0.4% to 237.84. Since January, the index has gained nearly 20% and has jumped more than 15% this quarter.

The UK's FTSE 100 index rose 0.4% to 4,916.80, while Germany's DAX index advanced 0.7% to 5,557.09 and the French CAC-40 index gained 0.8% to 3,680.61.

Indian markets extended its upswing for the third straight trading session on Tuesday with the NSE Nifty closing above the 4650 levels. The BSE Sensex has added nearly 450 points in the last 3 days.

Markets started off on a weak note mainly on the back of weak global cues coupled with selling pressure in the heavyweights. However, a sharp pull back in the Shanghai Se Composite in China lifted the sentiments on Dalal Street invigorating the NSE Nifty to end above the 4,650 levels.

The BSE Sensex gained 60 points or 0.4% at 15,688 after touching a high of 15,735 and a low of 15,423. The index opened at 14,574 against the previous close of 15,629. The NSE Nifty gained 16 points to shut shop at 4,659.

In Asia, the Nikkei in Japan ended lower by 0.8% at 10,497 while Australia's S&P/ASX lost 0.5% at 4,405. The Hang Seng index in Hong Kong slipped 0.5% at 20,435. Shanghai SE Composite in China gained by 2.5% at 2,915.

In Europe, stocks were trading in flat. The FTSE in the UK was, the DAX in Germany and the CAC 40 index in France were flat with a slight negative bias.

Coming back to India, among the BSE sectoral indices, the IT index was the top gainer, gaining 2%, followed by the Consumer Durables index that was up 2%. The BSE Oil & Gas index up 1.1% and the BSE Pharma index was up 1%.

The BSE Mid-Cap index gained 0.6% and the BSE Small-Cap index gained by 1.5%.

Among the 30-components of Sensex, 15 stocks were in the green while the other 15 ended in the red. The major gainers were Tata Motors, Wipro, Reliance Industries, RCom, Grasim and NTPC.

Among the major losers were, SBI, BHEL, Bharti, ICICI Bank and ONGC.

Outside the frontline indices, the big gainers in the broader market were Jubilant Org, Rolta, Mphasis, Educomp and HCL Tech. On the other hand, losers included Nagarjuna Const, Jai Corp, Tulip Tele and BEL.

Sugar stocks were under pressure after the government imposed limits on how much of the commodity users are allowed to hold. The government said that the bulk users of sugar, whose monthly consumption exceeds 1mt should not stockpile more than 15-days worth of the sweetener, the food ministry said.

Shares in Balrampur Chini fell 2.7%, Renuka Sugars declined 2%, while Triveni Engineering ended lower by 2%.

ABB gained 2% to Rs730 after it bagged Rs1,283mn order from Power Grid Corporation of India Limited for a 400-Kv(Kilovolt) gas insulated switchgear (GIS) substations to strengthen the power transmission network in the country's western Grid.

Shares of Suven Life Sciences were locked at 20% to Rs31.6 after the Chairman & CEO, Venkat Jasti said the company is in talks with four global Pharma majors, who are evincing keen interest about the possible out-licensing deals for SUVN-502, the company's lead candidate for Alzheimer's disease.

If everything goes well Suven will receive substantial upfront payments / milestones payments and royalties and it will be known only after Completion of due diligence around December 2009. Irrespective of the outcome of these deals, our Company is preparing for the commencement of Phase IIa studies for this molecule during next year and also for fund raising activity.

Ranbaxy Labs surged by over 7% to Rs343 after the company announced that it received approval from the U.S. Food and Drug Administration to manufacture and market Glycopyrrolate Tablets USP, 1 mg and 2 mg.

Mcleod Russel announced that Borelli Tea Holdings Ltd, UK, the wholly owned subsidiary of the Company has signed Shareholders Agreement to acquire 75% equity stake of Olyana Holdings LLC, USA, for US$2.75mn.

The stock ended lower by 2.5% to Rs176. It opened at Rs179 and made an intra-day high of Rs185 and a low of Rs174. Total traded volumes stood at 1.1mn shares.

Shares of Madhucon Projects rallied by over 10% to Rs224 after reports stated that the company plans to raise Rs5bn for Madhucon Infra via an Initial Public Offering.

Madhucon Infra is a wholly owned subsidiary of Madhucon Projects. The company is also planning to increase the power capacity to 1000MW from 540MW.

Stone India was locked at 5% upper circuit to end at Rs38.55 after it received the first bulk order for supply of Air Spring for passenger coaches from Rashtriya Coach Factory, Kapurthala for 123 coach sets. The order is valued at Rs 49mn.

The recently announced "Duranta Express" will use this new generation pneumatic suspension system which will provide superior air cushion ride for passengers for trains running at a higher speed. Stone India is manufacturing this product under collaboration from Sumitomo Electric Industries, Japan - the leading supplier of such products for Bullet Trains in Japan.

Shares of Piramal Life Science surged 4% to Rs76.45 after the company announced that it completed phase I trail for diabetes drug. The stock opened at Rs70 and made an intra-day high of Rs77 and a low of Rs70. Total traded volumes stood at 17,000 shares.