Seeking freedom

Between stimulus and response there is a space. In that space is our power to choose our response. In our response lies our growth and our freedom. Viktor E. Frankl. The main Indian equity indices are seeking freedom from the narrow trading range they have got stuck in of late. While the opening could be a tad positive, the overall trading sentiment will hinge on inflation data for July.With the markets closed for the Independence Day on Wednesday and global markets too in a consolidation mode, investors could just choose to remain on the sidelines. Meanwhile, yoga guru Baba Ramdev’s protest against Black Money seems to be giving the embattled UPA regime a tough time. While there might not be any immediate political fallout, the Congress-led alliance could perhaps pay for its lapses in governance in the 2014 Lok Sabha polls. The Indian markets are of course more concerned with the Centre’s potential remedial measures for the slowing economy amid fear of a ratings downgrade. Retail sector will be in focus amid news that 8 states and 2 UTs are in favour of allowing FDI in multi-brand retail. Tata Steel will be in the spotlight after its consolidated Q1 FY13 net profit plunged 89%, hit by weak European operations. Deficiency of rainfall is a cause for worry as it might put pressure on some commodities, RBI Governor D Subbarao said on Monday. Subbarao stuck to a hawkish tone, reiterating concern about sticky inflation and once again prodding the Government to do its bit by reigning in its fiscal profligacy. The RBI has stayed on hold since cutting its main interest rate in April by a bigger-than-expected 50 basis points to 8%. The WPI based inflation for July is likely to stay around the same level as in June, according to reports. The RBI’s next scheduled policy review is on Sept. 17. Subbarao said on Monday that the RBI does not have adequate room to respond to the ongoing global crisis. Asian stock benchmarks are more or less steady in Tuesday morning trade, with investors turning cautious ahead of important economic data due out of Europe and the United States later in the day. The Bank of Japan (BOJ) minutes showed today that policy makers in Japan aren’t ruling out any options to boost the world's third largest economy. US stocks ended Monday’s light-volume session slightly lower. Investors will keep a close eye on retail sales data. European markets finished mostly in the red on Monday. The euro gained the most in more than a week versus the dollar after a well-received Italian debt auction on Monday. Europe’s common currency fell earlier after reports quoted ECB's Governing Council member Luc Coene as saying that bond purchases won’t solve Spain’s and Italy’s difficulties. Key Results Today: ABG Shipyard, Amtek Auto, Asian Hotels (North) Limited, Bajaj Hindusthan, Deccan Chronicle, Electrosteel Castings, Essar Oil, Finolex Cables, Gammon India, Gateway Distriparks, HDIL, Hindalco Inds, Hindustan Copper, IDFC, Jain Irrigation, Kavveri Telecom, Kemrock Inds, Kesoram Inds, KS Oils, LML, MMTC, Monnet Ispat Energy, National Aluminium, Opto Circuits, Orchid Chemicals, Pipavav Defence, Piramal Healthcare, Rajesh Exports, REI Agro, Reliance Infra, Reliance Power, Shree Renuka Sugars, Simplex Infra, Sterling Biotech, Tamil Nadu News, Tanla Solutions, Tree House Education, Tulip Telecom, Unitech, Viceroy Hotels, Videocon Inds, Welcorp. Trend in FII flows: The FIIs were net buyers of Rs 3.39bn in the cash segment on Monday while the domestic institutional investors (DIIs) were net sellers of Rs 1.76bn, as per the provisional figures released by the NSE. The FIIs were net sellers of Rs 9.08bn in the F&O segment on Monday, according to the provisional NSE data. The foreign funds were net buyers of Rs 1.21bn in the cash segment on Friday, according to the SEBI figures. Global Data Watch today: Japan BOJ monetary policy minutes, Australia National Australia Bank’s Business Confidence (Jul), Australia National Australia Bank’s Business Conditions (Jul), Australia New Motor Vehicle Sales (Jul), China's FDI data for July, France Consumer Price Index (Jul), France Q2 GDP, Germany Q2 GDP, France Nonfarm Payrolls (Q2), Spain Consumer Price Index (Jul), UK Core Consumer Price Index (Jul), UK DCLG House Price Index (Jun), UK Retail Price Index (Jul), BoE Inflation Letter, EU Q2 GDP, EU Industrial Production (Jun), Germany ZEW Survey - Economic Sentiment (Aug), Germany ZEW Survey – Current Situation (Aug), US NFIB Business Optimism Index (Jul), US Producer Price Index (Jul), US Retail Sales (Jul), US Business Inventories (Jun) and US IBD/TIPP Economic Optimism (Aug).