Markets likely to open on a cautious note despite positive data inflow

The Indian markets return after a trading holiday on Wednesday and will try to match up with a fall in oil price. Apart from this, the GST collections reached a record high monthly collection in the month of April since the launch of the GST in July 2017. Also, Indian’s infrastructure output finally showed some improvement for March at 4.7 per cent, which will also work in favour of the Indian markets. However, an early indication from the SGX Nifty indicates that the Nifty may not cheer these positive data inflow as Nifty may open on a cautious note around 11,788 level. On the earnings front, the key stocks which will report their earnings today are Dabur, Hindustan Zinc, MRF, Radico and Tata Power. Going ahead, market participants will take cues from the Nikkei Manufacturing PMI for the month of April.

In Asia, Hong Kong’s index Hang Seng was trading higher by 0.41 per cent on Thursday, while the Japanese stock market Nikkei and China’s Shanghai Composite were closed for holiday.

Back home, the equity benchmark indices opened Tuesday’s session on a weak note and the weakness persisted for a major part of trading session amid some weak corporate earnings and unsupportive global cues. However, the benchmark indices recouped most of their losses towards the end of the trading session and ended the session on a flat note. The Nifty slipped 0.06 per cent to settle at 11,748 and the BSE Sensex shed 0.09 per cent to close at 39,032. The broader markets underperformed the benchmark indices with Nifty Midcap and Smallcap ending lower by 0.91 and 1.49 per cent, respectively. The sectoral indices displayed a mixed trend. Nifty Media, Nifty Metal and Nifty IT outperformed with posting gains of over 1 per cent each, while Nifty PSU Bank and Nifty Realty witnessed intense selling pressure.

The US stocks witnessed a roller-coaster ride on Wednesday. After moving higher in the early part of the trading session, the stocks came under pressure and ended the session in the red. The FOMC wrapped its two-day meeting and announced that it would leave interest rates unchanged. The late-day pullback by the stocks came after the Federal Reserve Chairman Jerome Powell said that the US economy is on a healthy path, incoming economic data was broadly in line with expectations and that weak global growth, Brexit and trade risks have moderated. These observations may have dashed some traders hopes that the Fed might be willing to adopt a more accommodative stance. Meanwhile, on the economic front, according to ADP, there were 275,000 jobs added to the private sector in the month of April. The Dow Industrial Average slipped 0.61 per cent, the S&P 500 lost 0.75 per cent and the tech-heavy Nasdaq fell 0.57 per cent.

The UK’s FTSE 100 ended lower by 0.44 per cent; while the other European markets were shut on account of May Day holiday.