Markets may open in the red amid negative news flow

Indian markets have to face a double whammy at the start of the week as India’s industrial output contracted 0.1 per cent in March, recording a 21-month low, due to slowdown in manufacturing sector and the world’s two biggest economies seemed at the end of the road over trade negotiations on Sunday as Washington demanded promises of concrete changes in Chinese law and Beijing said it would not swallow any ‘bitter fruit’ that harmed its interests. At the time of writing, the SGX Nifty was trading lower by 40 points at 11,244. The key results scheduled today are Godrej Industries, HDFC, Idea, ITC, Just Dial, Karnataka Bank, Oriental Bank of Commence, Muthoot Finance and SRF. On the macroeconomic front, market participants will keep an eye on CPI inflation, which is scheduled to be released today.

Asian stock indices have witnessed a rough start on Monday amid concerns about the ongoing US-China trade war weighed on investor sentiments. China’s Shanghai Composite has plummeted over 1 per cent and the Japanese Stock index Nikkei 225 has lost 0.41 per cent, while Hong Kong’s Hang Seng was closed for holiday.

Back home, the bears maintained their dominant position on Friday as the benchmark indices posted a negative close for the eighth consecutive session. The benchmark indices started off the session with an uptick and traded sideways; however, in the last half-an-hour of trading, bears pushed the benchmark indices lower. The Nifty and BSE Sensex closed below their crucial psychological marks at 11,300 and 37,500, respectively. In contrast to the frontline gauges, the broader indices ended the day in the green, with Nifty Midcap and Smallcap gaining 0.47 per cent and 0.57 per cent, respectively. Talking about the sectoral indices' performance, a mixed trend was witnessed, wherein Nifty PSU Banks and Nifty Media were top gainers, while Nifty Metal and IT remained under pressure. 

The US proceeded to raise tariffs on Chinese imports and there were certain reports that there would be necessary countermeasures to be imposed by China. Due to this, the US stocks tanked heavily in the initial part of the session. However, the treasury secretary Mnuchin’s comments that recent trade talks were ‘constructive’ helped the market recover and, at the close, the Dow Industrial Average edged higher 0.4 per cent, the S&P 500 added 0.40 per cent and the tech-heavy Nasdaq closed flat with a positive bias.

Majority of the European markets ended Friday’s session in the green amid some upbeat economic data. Germany’s benchmark DAX rose 0.72 per cent and France’s CAC 40 index ended higher 0.27 per cent, while UK’s FTSE slipped 0.06 per cent. In the economic news, UK economy grew by 0.5 per cent in the first quarter of 2019, accelerating from a 0.2 per cent seen in the final three months of 2018.