INDIAN EQUITY MARKET OUTLOOK - 16 MAY 2016

INDIAN BENCHMARKS Flat start on cards; WPI data eyed,

The Indian equity benchmarks are likely to witness a gap down opening on Monday tracking a mixed trend in Asian stocks as signs of a deepening economic slowdown in China weighs on risk taking appetite, while investors stay cautious ahead of the April WPI data to be released today, which may offer further cues over the health of Asia’s third biggest economy.

India’s wholesale inflation marked a 17th straight month in the negative terrain, coming in at -0.85 per cent in March 2016.Losses in the CNX Nifty Index Futures for May delivery which fell by 0.35 per cent or 27.5 points at 7,802 at 10:17 AM Singapore time also signal that Dalal Street may open lower today. The Sensex is expected to trade on a choppy note this week ahead of the next set of quarterly earnings numbers, progress of the monsoon and outcome of polls in five states with counting of votes for assembly elections in Assam, Kerala, Tamil Nadu, West Bengal and Puducherry to take place on Thursday. Shares of Punjab National Bank, Lupin and ITC will be eyed this week as they unveil their March quarter earnings. The 30-share Sensex on Friday plunged by 300.65 points or by 1.17 per cent to end at 25,489.57 as higher than expected April consumer inflation and reports that capital market regulator SEBI may tighten inflows through participatory notes soured sentiment. Meanwhile, marking a seventeenth straight month in the red, the country’s exports fell by 6.74 per cent to USD 20.5 billion in April 2016 from the year ago month.

Trend in FII flows:   The FIIs were net  sellers of  Rs -1493.88 Cr in the cash segment on Friday  while the DIIs were net buyers of  Rs 667.03 Cr, as per the provisional figures.

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