the Indian market is likely to open flat amid mixed global cues. While stocks on Wall Street finished lower overnight, the other major Asian markets are trading mostly higher this morning.
Profit taking and concerns about capital outflows following net selling by foreign funds on Monday may weigh on the market, but domestic financial institutions are likely to indulge in stock-specific buying. On a net basis, foreign funds sold shares worth Rs.102 crore on Tuesday, according to provisional data released by stock exchanges.
Meanwhile, early reports of fourth-quarter advance tax payments by companies showed a mixed trend. As of March 15, the last date for the payout, banking, FMCG and pharma sectors reported a higher tax outgo on the back of fiscal/monetary stimulus and rural demand, while construction and engineering companies were impacted by the spillover of the global financial turmoil into the real economy.
Overnight, stocks on Wall Street finished lower after American Express said its credit card default rates rose to 8.7% in February, offsetting the earlier optimism that the U.S. banks are seeing a revival. With traders reacting positively to comments from Federal Reserve Chairman Ben Bernanke, stocks were mostly higher through much of the session but pulled back sharply going into the close.
While the tech-heavy Nasdaq posted a particularly steep loss, the Dow and the S&P 500 ended the day only modestly lower. The Nasdaq Composite fell 27.48 points or 1.9 percent to 1,404.02, while the Dow Jones Industrial Average closed down 7.01 points or 0.1 percent at 7,216.97 and the S&P 500 index closed down 2.66 points or 0.4 percent at 753.89.
However, the Indian ADRs ended mixed. Satyam tumbled 5.03%, HDFC Bank declined 1.6% and Infosys moved down 0.91%, but Reddy's Laboratories rose 2%, Wipro gained 0.96%, MTNL jumped 7.56%, ICICI Bank climbed 7.12% and Sterlite added 2.4%.
Crude oil price, which declined sharply following OPEC's decision not to change the output levels, rebounded on Monday on expectations that economic recovery might happen earlier than expected. After settling at $47.35 a barrel, up 2.38% in New York trading on Monday, the commodity is trading at $47.02 a barrel in Asian trading.
The rupee rose the highest in more than 2 weeks to settle at Rs.51.40/41 against the dollar on Monday, boosted by hopes of revival in capital inflows following gains in the stock market and weakness of the US dollar overseas.
