Opening bell: Sensex, Nifty start on positive note amid easing US-China trade tension

The benchmark indices continued the upward trend on Tuesday morning, after closing higher on Monday as well over signs of easing trade tension between the US and China. Taking a cue from global markets, both Sensex and Nifty were trading in green on Tuesday. The Sensitive Index (Sensex) of the BSE, which had closed at 39,686.50 points on Monday, opened higher at 39,811.68 points. Minutes after the market opened, it was trading at 39,791.65 points, up by 105.15 points, or 0.25 per cent. Meanwhile, the National Stock Exchange (NSE), the broader Nifty 50, which had closed at 11,865.60 points on Wednesday, was quoting at 11,870.05 points, up by 4.45 points or 0.04 per cent. 

Jayant Manglik, President, Religare Broking told Zee Business Online, ''The coming week is going to be an important one, not only for the financial markets but for the economy as a whole. First, participants will react to the outcome of G20 meet and hopes are high that the world leaders would reach an agreement to deescalate the trade war tension and geopolitical issues. On data front, Nikkei Manufacturing PMI data and Nikkei Services PMI data are scheduled to be announced on July 1 and July 3 respectively. Besides, the monthly sales data of auto and cement companies will also start pouring in. Above all, we’ve Union Budget on July 5, the first after the re-election of NDA government.''

The Asian markets too showed a positive trend on Tuesday. Japan's Nikkei 225 was quoting in green, up by 0.12 per cent, Hang Seng was also up by 1.37 per cent. South Korea's Kospi was quoting in red, down by 0.28 per cent. China`s Shanghai Composite was also trading in red, down by 0.06 per cent. Overnight, Nasdaq closed in green, up by 1.06 per cent, FTSE was up by 0.97 per cent at the closing on Monday. On the currency front, the Indian rupee opened marginally lower at 68.97 per dollar on Tuesday. The global oil benchmark Brent crude futures jumped 0.42 per cent high to 65.46 per barrel. 

''We expect the budget to be pro-growth given the decelerating economic growth and rising unemployment rate. Also, it would likely to set the roadmap for the government to implement key policies and tax reforms over its tenure. Participants should prepare themselves for a volatile week, citing a list of events and data which are lined up. The focus should more be on risk management aspects as we may erratic swings in index as well as stocks as the events would unfold. Nifty may continue to hover in a broader range of 10,500-12,000. We advise preferring hedged positions instead of naked trades and keeping a check on the position size,'' Manglik added. 

This cascading effect came in after the two economic powers China and the U.S. from the G20 summit meeting in Japan confirmed in separate comments that they do not plan to levy any new tariffs against each other’s products at the present time. The hold off is expected to provide some relief to the global markets but investors will seek more clarity on tariffs soon.

On the domestic front, auto sales hogged the limelight as investors closely monitored this sector which is reeling under the pressure of dismal auto sales, regulatory transitions and margin contraction. The sector is yet to see the light at the end of the tunnel as June Sales have again shown a sorry picture by Maruti Suzuki, Ashok Leyland, Bajaj Auto, Escorts and M&M.