Markets to See Buying Interest after Yesterday’s Sell Off

The Reserve Bank of India (RBI) surprised the markets for second times by cutting repo rate by 25 basis points, since January 1. The surprise move came ahead of RBI’s bi-monthly review meeting in early April. This surprise move surpassed the doubts among the people who were denying the beginning of big rate cut cycle. This seems that the reserve bank and the government are simultaneously working complementary to the country’s growth. The market gave big thumps up to this surprise move with huge gains on the bourses in early trades on the announcement day. The BSE Sensex breached the dream figure of 30000 and touched an intraday high of 30024.74 after the announcement in early trades on last Wednesday. The banking stocks which are the direct beneficiary of the rate cut soared on the bourses and the Banknifty touched its lifetime high of 20541.65 in the morning trades on Wednesday.

However, after a fresh life time high at 30024 level, the Indian markets witnessed negative trade with heavy amount of selling pressure. The Sensex tanked around 500 points in the closing buzz, as the Asian markets and the European markets were surrounded in negative sentiments. The Banking stocks lost all their morning gains and Index was closed deep by 405 points. Mid-Caps and Small-Caps too saw selling pressure and the respective indices were down by more that one per cent each. The Nifty tanked and closed around its crucial support level, down by 73 points and closed at 8922 level while Sensex was down by 213 points and closed at 29380 level.

The Indian markets showed sell off due to the early trade losses in the European markets, the European market surged strong after the crude oil prices slipped later in the day. The markets were trading higher also on positive data on retail sales in the Euro zone. The French stock market index CAC 40 surged higher by 0.99 per cent at 4917. The German stock market index DAX too surged by 0.98 per cent at 11390 during the yesterday’s trading session. The UK FTSE closed at 6919, up by 0.44 per cent.

Again on Wednesday, the US stocks ended in negative a second consecutive session, sending the S&P 500 to its lowest level in two weeks. The US market investors remained cautious ahead of the closely watched official jobs report, due on Friday. The earlier declared economic data during the week too were mixed on manufacturing, consumer spending and inflation front. The Nasdaq closed at 4967, down by 0.26 per cent. The S&P 500 and Dow industrials closed at 2099 and 18097, down by o.44 and 0.58 per cent respectively.

The Hong Kong stocks were treading lower in the morning after China cut its growth target for 2015. The Hang Seng index was trading lower by 0.31 per cent. However, the Japanese stocks were showing some buying interest with the Japanese Nikkei 225 trading higher by 0.24 per cent on Thursday morning. The Australian market continued its southwards movement on the second day also. The Australian ASX 200 was trading lower by 0.34 per cent in the morning. 

The SGX Nifty is trading flat with just 7 points gain on today morning. The Indian markets are expected to see some buying interest after yesterday’s sell off.