Greece, monsoon forecasts likely to keep markets range-bound

Indian stock markets fell marginally on Thursday snapping the strong rally seen on Wednesday and reaffirming the trend that indices will stay range bound for some days in the absence of any major positive triggers.

While the crisis in Greece continues to add to the overall uncertainty, conflicting reports on the monsoon outlook for July, vital for the kharif crop, will likely compound the situation, say traders and analysts.

On Thursday, the Sensex fell 75 points to 27,945.80 points after investors sold metal and IT stocks amid the uncertainty over Greece. The NSE’s Nifty was down 8 points at 8,444.90 points.

“But the undercurrent continues to be strong with a rally in the mid-caps. First quarter results will soon start rolling out and it is a good time to wait and watch,” said Vinod Nair, head of research at Geojit BNP Paribas.

Other triggers that will keep the index steady are the move on capital infusion for banks.

But differing reports on the monsoon performance in July could likely pull down sentiment. While Skymet has said rains will be above normal, the IMD has given a bleak outlook.

RBS Private Banking India chief investment officer Rajesh Cheruvu said that next two to three months are crucial due to monsoons, Parliament session and Bihar elections. “Investors may not want to pump in money in the shortterm,” he added.

Waiting for a positive trigger