Markets may open lower tracking weak Asian peers on lack of agreement on US debt deal, and investors turning jittery ahead of Reliance Industries June quarter earnings today and Reserve Bank of India policy on rate hike on Tuesday.
The Nifty futures on the Singapore Exhchange declined 28 points, at 5,612.
Asian markets posted losses during the Monday morning session as the United States government, over the weekend failed to reach a consensus on debt ceiling. Investors turned risk averse on concerns of a possibility of debt default by US, unless an agreement was reached to raise the debt ceiling by $2.4 trillion by August 2nd.
Japan's The Nikkei Stock Average declined 0.6%, China’s Shanghai Composite Index was off 0.9% and Hong Kong’s Hang Seng Index shed 0.7%.
Back in India, Reliance Industries will be closely watched after the cabinet approved the largest foreign investment deal between Reliance Industries and British Petroleum at $7.2 billion on Friday evening. Through this venture, BP will acquire stake in 23 oil & gas blocks of RIL for exploration. Meanwhile, RIL is also expected to report June quarter earnings after market hours today. The company is expected report 16%.6 rise in net profit, to Rs 5,658 crore year-on-year led by 28.7% rise in revenues, at Rs 74,960 crore. Analyst expect RIL to report gross refining margins between $10-11 per barrel for the June quarter.
Reserve Bank of India rate hike policy tomorrow will also set the tone for the markets. The central government has increased rates ten times in last one year to rein in inflation which has been stubbornly high at 9% for June, below the government target of 8% for FY12. Economists expect RBI to raise rates by another 25 bps point and pause thereafter.
Retail shares such as Pantaloon Retail, Shoppers Stop and Trent will also be on the radar this morning after the committee of secretaries recommended 51% Foreign Direct Investment in multi-brand retail on Friday. The secretaries’ decision will need to get a cabinet nod for an approval.
