Enjoy the start!

Enjoyment is not a goal, it is a feeling that accompanies important ongoing activity.- Paul Goodman.

The past three months have been anything but enjoyable for the Indian market. The key indices had a dismal May due to European debt worries. Stocks rebounded in June. But hopes of an encore in July were dashed with the market slipping into a consolidation phase. In contrast, world markets (especially the US and Europe) did extremely well, as concerns over the euro-zone debt crisis ebbed. Also, earnings were largely healthy.



So, this under-performance by India in July is not in sync with the overall prospects for India. At the same time it does raise a few questions about the near-term outlook. F&O indicators point to a broad range of 5300-5600 for the NSE Nifty in August. In the immediate future, some resistance is seen at 5450 before we could see that elusive 5500 mark.

Today’s start should be a good one with most Asian markets on a firm wicket, notwithstanding the lackluster show of US and European markets on Friday. The fact that risk appetite has returned in global markets could help the bulls rediscover the winning ways.

Corporate results will keep rolling in till the middle of this month and will have a bearing on the sentiment. Markets around the world will also take cues from economic reports in the early part of this month. China's manufacturing output slowed in July to the lowest since March 2009. But the benchmark stock index in Shanghai is holding its own amid speculation that the authorities might not announce any more aggressive tightening measures.

Markets will be closely following Friday's monthly jobs report in the US. Before that, the central banks in the UK and EU will hold their monthly review meetings.

Auto and Cement stocks will be in focus as companies declare their monthly sales volumes. In fact, Bajaj Auto, TVS and Tata Motors have already announced their numbers, which are pretty robust. Others like Hero Honda, Maruti, M&M, Ashok Leyland and Eicher Motors will do so either today or in the next few days.

Results Today: Apar Industries, Gail India, GSK Consumer, Gulf Oil, India Cements, Madras Cements, Nestle India and NMDC.

FIIs were net buyers of Rs2.11bn in the cash segment on Friday (provisionally), according to the NSE web site. Local funds were net sellers of Rs1.3bn. In the F&O segment, they were net buyers at Rs18.66bn. On Thursday, the FIIs were net buyers of Rs44.38bn in the cash segment. Mutual Funds were net sellers at Rs6.36bn on the same day.