Market seen firm in opening trade; Tata Motors watched

The market is likely to see a firm start on Friday, 30 March 2012. Trading of S&P CNX Nifty futures on the Singapore stock exchange indicates a gain of 14 points at the opening bell. Asian markets were trading mixed. Tata Motors on Thursday reportedly hiked prices by up to Rs.60,000 per unit on its entire range of commercial vehicles following hike in excise duty in the Union Budget 2012-13. The company hiked the prices of its commercial vehicles by 2-5% considering hikes in excise duty on vehicles and chassis. The hike was with effect from 17 March 2012. The board of Coal India (CIL) on Thursday, 29 March 2012, failed to finalise the fuel supply agreements a (FSA) due to production constraints. Key benchmark indices edged lower for the second straight day on Thursday, 29 March 2012 as weak global stocks weighed on sentiment. The BSE Sensex lost 63.01 points or 0.37% to settle at 17,058.61, its lowest closing level since 26 March 2012. Volatility was high as traders rolled over positions in the futures & options (F&O) segment from the near-month March 2012 series to April 2012 series ahead of to the expiry of March 2012 contracts. The March 2012 derivatives contracts expired on Thursday, 29 March 2012. Essar Oil after market hours on Thursday, 29 March 2012 announced the completion of its Rs 8300-crore expansion of its Vadinar Refinery with the successful commissioning of the final Delayed Coker Unit (DCU), which is amongst the world's largest. The Vadinar Refinery is now India's second largest single-location refinery, with an annual capacity of 18 million tonnes (3.75 lakh barrels per day) and a complexity of 11.8, which also makes it among the world's most complex refineries. Finance Minister Pranab Mukherjee early this week said the new tax avoidance rules are meant to check tax avoidance through complicated deals, and not directed against any particular mode of investment like participatory notes (PNs). His comments come at a time when there are concerns in the market that investments through participatory notes and those coming to India through tax havens like Mauritius could be subject to General Anti-Avoidance Rules which comes into effect from 1 April 2012, which in turn could impact FII inflows. Participatory Notes or P-Notes are instruments issued by registered foreign institutional investors to overseas investors, who wish to invest in the Indian stock markets without registering themselves with the market regulator, the Securities and Exchange Board of India (Sebi). Mukherjee on 16 March 2012, while presenting the Union Budget 2012-13, proposed to introduce the General Anti-Avoidance Rule, or GAAR, which would give the tax body the right to examine the motivation for transactions by foreign investors. Mr. Mukherjee said at the time that GAAR is aimed "to counter aggressive tax avoidance schemes." Under GAAR, a transaction would be presumed to be for obtaining tax benefit unless the taxpayer proves that obtaining benefit wasn't the main objective. India's tax treaty with Mauritius exempts capital gains from being doubly taxed, but GAAR could override such tax treaties. Foreign institutional investors (FIIs) sold shares worth Rs 1,332.85 crore on Thursday, 29 March 2012, as per provisional data from the stock exchanges. The next major trigger for the market is Q4 March 2012 earnings. Investors will focus on the guidance provided by the management for the year ending March 2013 (FY 2013) to gauge the earnings outlook. IT bellwether Infosys announces Q4 March 2012 results on 13 April 2012. Asian markets were mixed on Friday as investors eyed key events that could dictate market trends in coming months, and as the first quarter drew to a close after a stellar performance from equities. Key benchmark indices in China, Indonesia, Singapore and South Korea were up by between 0.07% to 0.49%. Key benchmark indices in Hong Kong, Japan and Taiwan were down by between 0.12% to 0.78%. European Union economic and financial affairs ministers meeting in Copenhagen on Friday and Saturday are due to finalise a financial firewall that should help the euro zone's highly indebted economies, such as Italy and Spain, but there is discord about the size of the rescue fund. German Finance Minister Wolfgang Schaeuble said on Thursday the bloc should not commit more than 800 billion euros in rescue aid, and that money should only be available when countries promise reforms. US stocks ended mixed on Thursday as economic data and overseas concerns weighed on investor sentiment, though blue chips eked out their first gain in three days with a late-day surge. The Dow Jones Industrial Average rose 19.61 points, or 0.2%, to 13145.82. The Standard & Poor's 500-stock index lost 2.26 points, or 0.2%, to 1403.28. The Nasdaq Composite index declined 9.6 points, or 0.3%, to 3095.36. The US economy expanded at an unrevised 3% in the fourth quarter of 2011, the Commerce Department said in its third and final estimate for the period. The gain, while the strongest since the second quarter of 2008, lagged behind expectations of a 3.2% increase. Meanwhile, the number of US workers filing new applications for unemployment benefits was higher than expected, though it fell to its lowest level since April 2008, indicating steady improvement in the labor market.