MUMBAI: Stocks are likely to see some respite on Monday after a turbulent session last week, propped up by worldwide measures to support markets amid the global financial turmoil. Asian markets were on recovery path Monday after Australia guaranteed bank deposits and European leaders agreed to support lenders in a global effort to end the credit crisis.

Hang Seng rose 0.31 per cent, Straits Times added 0.52 per cent and S&P/ASX climbed 3.68 per cent. Japanese markets are closed for a national holiday.

Wall Street futures indicated a sharp rebound ahead of the opening bell on Monday. Dow Jones Industrial futures rose 235 points, or 2.8 per cent, to 8,605. Standard & Poor’s 500 futures jumped 19.25, or 1.50 per cent, at 1,309.00; and Nasdaq-100 futures added 22.10, or 2.48 per cent, at 913.10.

Back home, finance minister Palaniappan Chidambaram expressed confidence that India can weather the storm of financial crisis blowing across the world saying the country’s economic fundamentals and the banking system were strong.He admitted there is a liquidity crunch in the market and that the economy was facing ‘spill over and ripple’ effects of the global storm but held out an assurance that the RBI is ready to take further steps and infuse more liquidity if necessary. The finance minister is expected to make a statement on the market situation at 9:30 am, before the markets open for trade Monday.

Meanwhile, the Reserve Bank of India chief Duvvuri Subbarao said that India may escape the worst consequences of the global financial crisis due to its strong internal drivers for growth but money, debt and credit markets may be impacted indirectly. The RBI governor told the International Monetary Fund in Washington on Saturday he welcomed coordination among developed economies to manage the crisis, but implications of such management on emerging economies should be explicitly factored in. “Second, emerging and developing economies should be taken into confidence and consulted whenever the policies and actions of the developed countries have implications for them,” he said. The comments were posted on the central bank’s web site.

On Friday, it was a roller coaster session for the Indian stock market which saw host of positive and negative news-flow trickling in. However, bears were vindicated in the end as equities ended with heavy losses.

Bombay Stock Exchange’s Sensex closed at 10,527.85, down 800.51 points or 7.07 per cent from Thursday. The index touched an intra-day low of 10,239.76. National Stock Exchange’s Nifty ended at 3279.95, down 233.70 points or 6.65 per cent. The 50-share index touched a low of 3,198.95.

Continuing their heavy selling, foreign institutional investors on Friday shed equities worth Rs 2,513.74 amid the benchmark Sensex dropped to an over two-year low level. Domestic institutional investors bought equities worth Rs 1,744.68 crore, according to provisional data on NSE.

source: Economic times

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