Market may open higher on positive global equities

The market may open higher following the end of political spat between the UPA-DMK alliance and firmness in global markets. Trading of S&P CNX Nifty futures on the Singapore stock exchange indicates a rise of 20 points at the opening bell. After days of intense bargaining, the Dravida Munnetra Kazhagam (DMK) and the Congress on Tuesday clinched a deal, under which the national party would contest 63 seats in next month's Tamil Nadu Assembly elections. Shares of Reliance Industries (RIL) may come under pressure n reports the market regulator Securities & Exchange Board of India has started adjudication proceedings in a case of an alleged takeover code violation by RIL in 1999-2000.



As per provisional figures, foreign funds bought shares worth Rs 237.07 crore and domestic funds sold shares worth Rs 140.46 crore on Tuesday, 8 March 2011.

Asian stocks were trading higher on Wednesday, 9 March 2011. The key benchmark indices in Hong Kong, Japan, South Korea, Taiwan, Indonesia and China rose by between 0.09% to 1.03%. Singapore's Straits Times fell 0.12%.

US stocks gained ground Tuesday amid hopes on Wall Street that OPEC would increase oil production to make up for lost production in Libya. The Dow Jones Industrial Average jumped 124.35 points, or 1.03%, to 12,214.38. The Standard and Poor's 500 Index gained 11.69 points, or 0.89%, to 1,321.82 and the Nasdaq Composite Index added 20.14 points, or 0.73%, to 2,765.77.

Back home, India dedicated equity funds attracted $50 million in net new cash in the week ended 2 March 2011, latest data from global fund tracker EPFR Global showed.

US crude futures were down $0.52 a barrel or 0.50% to $104.50 a barrel. The unrest in North Africa and Middle East has pushed global crude prices to their highest levels since 2008 as markets factored in a disruption in supplies from Libya and potentially other major producers. High crude oil prices remain a cause for concern for India which imports majority of its crude oil requirements.

As per reports, the south-west monsoon is likely to be normal for the second straight year in 2011. Good rains would boost farm output that could help the government tame high food prices. Good rains will boost rural income. The India Meteorological Department (IMD) will come out with its first forecast on this year's monsoon season in April 2011 with periodic reviews as the four-month season progresses.

Global rating firm Moody's on Monday, 7 March 2011, said India's recent budget plan for fiscal 2012 is "credit positive" for the Indian government's current Baa3 rating with a stable outlook. The budget projects a deficit of 4.9% of GDP, excluding privatization revenues, down from the 5.3% estimated for fiscal 2011. "This will sustain a faster de-leveraging of government debt than originally forecast, and is credit positive for the Indian government," Moody's said.

Among the positive factors, Moody's cited a liberalization of domestic petroleum prices and one-off price increases in kerosene and liquefied petroleum gas which support the profitability of oil marketing companies, thereby limiting the need to lend to public-sector oil companies. "Nevertheless, high oil prices still pose a risk to the projected budget deficit given the absence of a full or much greater pass through of global oil prices to end users," the rating agency said.

The Central Statistical Organisation (CSO) will unveil the industrial production data for January 2011 on Friday, 11 March 2011. Industrial production growth eased to a 22-month low of 1.6% in December 2010 from an upwardly revised growth of 3.6% recorded in November 2010.