Markets may open flat despite positive cues from GST Council meet

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Indian equities may witness a flat opening on Monday, tracking mixed cues from the Asian peers. Muted trend in the SGX Nifty, which was trading at 8,833.50, up by 9.50 points or 0.11 per cent, also indicated a flattish start for the Indian markets.

On the weekly charts, the Nifty50 Index formed the indecisive ‘Doji’ candle. In the earlier week too, a ‘Doji’ formation was observed, so a back-to-back formation of indecisive candles on the weekly chart indicates that the market lacks momentum for substantial up-move. Now, going forward, the level of 8700 is a crucial support level and, on the upside, the level of 8830 and 8890 are major roadblocks for the index.

The prospects of a roll-out of the Goods and Service Tax (GST) by July 1 brightened with the GST Council approving on Saturday a draft law that seeks to compensate states fully in case of revenue loss as a result of the tax reform.

Back home, Indian markets got off to a scintillating start courtesy HDFC Bank, as RBI removed it from FII purchase restriction. However, profit booking emerged at higher levels and the session ended off the day’s high.

The US stocks finished higher on Friday as the Dow Jones Industrial extended its streak of record closes to the seventh session. The Dow Jones Industrial Average increased 4.28 points to finish at 20,624.05. The S&P 500 index edged up 3.94 points and the Nasdaq Composite Index rose 23.68 points.

On Monday, Asian shares are trading on a mixed note; the Japan’s Nikkei 225 fell as much as 0.21 per cent, as a stronger yen hurt exporters by making goods produced in Japan more expensive overseas.  Hang Seng and Shanghai Composite trading with gains of 0.55 and 0.45 per cent, respectively.

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