Pre Open Thoughts: RBI in Tight Spot!!

Pre Open Thoughts: RBI in Tight Spot!!

Ø Optimism is essential to achievement and it is also the foundation of courage and true progress. The indices just about managed to hold on to 5300 levels. So where do we go from here?

Ø It is unlikely to be a one-way street in the immediate future given the global risk involved and also the RBI policy on domestic front. As Bond yields have risen steadily, putting the RBI in a tight spot. Market direction would further come from the quarterly numbers which would come out, that would give a very clear indication as to where we are heading in terms of growth, where we are heading in terms of margin pressures and other things.

Ø The opening today is likely to be negative due to weakness across global markets. The minutes of the last FOMC meeting shows reduced chance of QE3 as of now. European shares fell amid worries about Spain’s worsening fiscal health.

Ø Going forward lot will also hinge on how the FII & Domestic flows. Of course some resistance is bound to be there at higher levels. Over All The undercurrent will remain unclear with Nifty finding support at 5280-5300 where 5400-5450 remains to be the resistance levels.

Ø The FIIs were net buyers of Rs 3.32bn in the cash segment on Tuesday while the domestic institutional investors (DIIs) were net buyers of ~Rs 2bn, as per the provisional figures released by the NSE.

Ø Coal India Will be in Focus As the Indian government issued a presidential decree to force Coal India to guarantee long-term fuel supply to private power firms, as it used its discretionary authority to trump independent directors who resisted pressure from the Prime Minister's Office and said such pacts would harm the company.

Ø Meanwhile Zee Entertainment Enterprises Ltd.’s board of directors will meet to consider a proposal to buy back equity shares up to a value not exceeding 10 percent of capital and free reserve.