Indian markets again closed flat after last hour sell off with strong trading in green since the morning. The markets are not sustaining the gains on bourses and experiencing a sell off ahead of derivative expiry and union budget. The railway stocks showed considerable correction on a day before the railway budget. The stocks like Titagarh Wagons, Kernex Microsystems, Hind Rectifiers, Texmaco Rail & Engineering, Transformers & Rectifiers, etc. showed correction ranging between 1 to 6 per cent yesterday.
On European front, the European market seems to be taken some breather after a straight six session winning streak. The French stock market index CAC 40 and the German stock market index DAX closed almost flat at of 4882 and 11210 during the yesterday’s trading session. the UK markets too experienced some profit booking after taking some negative cues from the ongoing earning season. The UK FTSE closed at 6935, down by 0.21 per cent.
On US front too, the US markets saw a volatile session yesterday. However, the US indices closed almost flat in the end. The S&P 500 and Dow industrials closed at 2108 and 18225 respectively. The Nasdaq closed in marginal red after a straight 10 trading sessions, at 4967, down by just 0.02 per cent.
On Thursday morning, the asian markets were showing mixed bagged sentiments as there were no major global news flows. The Japanese Nikkei 225 was trading up by 0.43 per cent at 18665, regaining its winning streak. The Hang Seng was too trading in green with 0.11 per cent gains in the morning over surprising preliminary data of China’s manufacturing activity. However, the Australian ASX 200 was trading in red, down by 0.47 per cent despite of good earnings results announced today morning.
The railway mister of the NDA government will present its first whole year Railway budget today. This will be a major trigger for the market and give some idea about the Union Budget scheduled on February 28. The market participants have considerable expectations on fiscal deficit, public spending, inflationary control, tax policies and other reforms front from this majority government. The markets were cheering primarily on the paradigm shift in market sentiments after the newly elected government and its focus on reforms. The smart investors in the markets i.e. Foreign institutional investors have created considerable short positions in February compared to long positions in January. Hence if the budget fails to satisfy the market expectations, the Indian markets are set to experience a considerable correction.
On morning, the SGX Nifty was trading flat with 0 points change at 8765.50. We too expect markets too open flat today. However, the Railway budget is expected to create good amount of volatility in today’s trading session. Hence keep an eye on the railway budget session.