Friday, September 21, 2012
The Indian equity benchmarks extended losses to a second straight trading session as market participants continued to lock in profit on Dalal Street. The NSE Nifty ended below the 5600 mark but just managed to close above 5500. Market participants were anxious about mounting concerns about the worsening political situation in the country and lingering worries over the precarious global economic outlook. The honeymoon between the Trinamool Congress and the Congress party is over following bitter differences over the recently announced reform measures. The UPA Government is also under pressure from other political parties, including allies like DMK over its decision to allow FDI in multi-brand retail and the steep hike in fuel prices.
Attack is the best form of defense – Proverb. UPA II seems to have decided to shed inertia and go on the offensive, notwithstanding a nationwide strike against its reform measures and impending pull-out by Trinamool Congress. The Government is reportedly lining up more reform-oriented moves in the coming days to try and thwart the Opposition’s tirade. The Prime Minister is scheduled to address the nation on Friday to explain the Centre’s rationale behind recent reforms. The Government has already notified FDI in multi-brand Retail and Aviation. The start today will be positive as Asian markets are trading with a positive bias. US markets were largely flat while European indices closed lower.
The Indian markets may open on a positive note led by positive Asian cues. SGX Nifty is also trading 18 points higher. Events for the day: Ex date for final dividend of Global Offshore Services, Vivimed Labs. Ex date for dividend of Jindal Saw, Opto Circuits (India).
Key benchmark indices fell for the second straight day to hit lowest closing level in a week as weak global stocks and political crisis at home following Trinamool Congress, a key ally of the ruling UPA government deciding to withdraw its support to the government weighed on sentiment adversely. The barometer index, BSE Sensex, was down 146.76 points or 0.79%, up about 60 points from the day's low and off close to 95 points from the day's high. The market breadth was negative. Index heavyweight and cigarette maker ITC edged higher in volatile trade. Another index heavyweight Reliance Industries (RIL) dropped nearly 3%. IT stocks rose on a weak rupee. India's markets were closed Wednesday due to a religious holiday.