The market may remain sideways with negative bias, as traders may refrain from building fresh positions ahead of slew of holidays next week and due to subdued to weak trend in Asian markets. Next week is a curtailed trading week as the market remains closed for two days in a row on Tuesday (1 May) and Wednesday (2 May) on account of a public holiday.
Corporate results announced so far, have been strong. After trading hours on Thursday, Reliance Industries (RIL) reported Q4 results that beat market expectations. RIL reported 14% growth in net profit in Q4 March 2007 at Rs 2853 crore compared to Rs 2520 crore in Q4 March 2006, on the back of strong refining margins. The company said refining margins for the March 2007 quarter were $13 a barrel, higher than the benchmark Asian Dubai crack margin, which averaged less than $7 in the quarter.
The market wide rollover of April derivatives contracts to May contracts was around 70-72%, which is almost the same as was witnessed during the previous expiry but lower than the 12-month average. Many investors let their long positions expire as they do not expect the market to sustain its recent gains. Corporate results, FII inflow, RBI's pause on rate hike and firm global markets helped the Sensex gain 1773.51 points (14.2%) from a low of 12,455.37 on 2 April 2007. The Sensex had tanked 617 points in a single trading session on 2 April 2007, following the Reserve Bank of India (RBI)'s surprise hike in interest rates announced after trading hours on 30 March 2007.
The major March 2007 quarter results today are that of Bharti Airtel and Ranbaxy Laboratories.
The key economic data due today is the weekly inflation data. India's wholesale price inflation rate is forecast at 6.09% for the 12 months to 14 April 2007, unchanged from a week earlier. The data will be released around noon on Friday (27 April). The annual rate hit 6.69% on 27 January 2007, its highest in more than two years, but has moderated after the central bank tightened policy and the government cut duties on a range of items to rein in prices.
FIIs have pumped money heavily into Indian stocks, this month. Their inflow picked up after IT major Infosys on 13 April 2007, issued a strong guidance for FY 2008, putting to rest concerns of a US economic slowdown on the IT sector. FII inflow for April 2007 (till 25 April) reached Rs 6514.20 crore. FIIs had pulled out a net Rs 1082 crore in March 2007.
As per provisional data FIIs were net sellers to the tune of Rs 89 crore on Thursday (26 April). Domestic institutional investors were net sellers to the tune of Rs 178 crore on Thursday.
Asian stocks nudged lower on Friday (27 April) as caution prevailed ahead of first-quarter US economic growth numbers later this session. Key benchmark indices in Hong Kong, Japan, China, South Korea, Singapore and Taiwan were down by between 0.1% to 1.1%. US data later on Friday is expected to show that the world's biggest economy expanded at an annualised rate of 1.8 percent in the first quarter, slowing from a 2.5 percent pace in the fourth quarter of 2006.
US stocks gained on Thursday, as better-than-expected profits from such companies as 3M Co. and Exxon Mobil Corp. propelled the blue-chip Dow Jones Industrial Average to its second straight close above 13,000. The Dow finished up 15.61 points, or 0.12 percent, at 13,105.50. The Standard & Poor's 500 Index ended down 1.17 points, or 0.08 percent, at 1,494.25. The Nasdaq Composite Index closed up 6.57 points, or 0.26 percent, at 2,554.46.
London Brent crude, currently seen as most representative of global oil prices, was up 17 cents at $67.82, supported by a slew of refinery outages in the United States that have thinned gasoline stocks.