CONFIDENT NOTE

Indian markets have kicked off the week on a confident note as they bounced back after being appalled by the devastating Japanese earthquake followed by the massive tsunami on Friday. Nature's destruction proved as a blessing in disguise for the local benchmarks as concerns over oil's demand prospects were on the rise thereby pummeling the Nymex crude prices below $99 per barrel. While moderating tensions from the Middle East and North African nations coupled with the assurance of ample oil supplies too undermined the oil prices giving some respite to the domestic investors. Buying momentum gained from strength to strength in heavyweights stocks through the day's trade and more prominently so in oil and gas and metal counters which got drubbed off-late in the wake of spiraling crude oil prices due to the prolonged civil upheaval in Libya and neighboring Arab nations. Meanwhile investors shrugged off the worse than expected February inflation numbers released by the government today which unexpectedly moved higher to annual 8.31% versus 8.23% in January. The higher than expected figure has increased the pressure on RBI's strategy to manage inflation. It is widely expected that RBI will hike the policy rates for the eighth time since last March by at least 25 basis points on March 17 in its mid-quarterly policy review. The NSE's 50-share broadly followed index, Nifty garnered over one and half a percentage point to regain the crucial 5,500 support level while the Bombay Stock Exchange's Sensitive Index, Sensex accumulated over two hundred fifty points to settle tad below the 18,450 mark. The broader markets too snapped the day in the positive territory but ended up underperforming the larger peers by quite a margin. The BSE's midcap index went home with gains of 0.49% while the smallcap index added a marginal 0.26% points. On the BSE sectoral front, the oil and gas counter remained the top gainer in the space as it went home with strong gains of 2.24% after oil companies like BPCL and HPCL soared 4.36% and 4.50% respectively as crude oil prices receded to lower levels in today's trade. While index bellwether RIL too firmly held the fort as it jumped 2.63% thereby helping the bourses to snap the day's trade around the high point of the day. The metal's pocket too remained amid the thick of the things as it amassed 2.01% gains after shares of companies like Tata Steel and JSW Steel zoomed 3.27% and 2.85% respectively. There remained no sectoral index which ended in the red zone but individual stocks like Bharti Airtel and Hindustan Unilever failed to enlist their names in the gainers' list and respectively slipped 0.40% and 0.16%.

On the global front, Asian equity indices settled in the mixed zone as sentiments remained cautious after Japanese Nikkei plummeted more than six percent as investors there reacted to the biggest earthquake in the country's history, a devastating tsunami and an unfolding nuclear emergency. The European markets too are mirroring similar trends with the DAX shrinking around a percent, being the top laggard. On the other hand, the screen trading for US index futures indicates that the Dow could open with around half a percent cut.

Earlier on Dalal Street, the benchmark got off to a soft start this morning tracking the Asian peers which traded on a subdued note in the early hours. The frontline indices soon recovered from early morning's losses and gradually kept gaining steam on the back of robust buying in aviation, energy and auto stocks, owing to a fall in oil prices. The buying interests got reinforced in the second half of trade as the indices were propelled by hefty position build up in  heavyweight Reliance Industries which provided that much needed fillip to the markets. Eventually markets staged a strong recovery after Friday's drubbing and swelled over 250 points in the session. The markets registered volumes of over Rs 1.13 lakh crore while the turnover for NSE F&O segment remained on the lower side compared to Friday at over Rs 1 lakh crore. Market breadth remained positive as there were 1520 shares on the gaining side against 1327 shares on the losing side while 146 shares remained unchanged.

Finally, the BSE Sensex surges 265.39 points or 1.46% to settle at 18439.48 while the S&P CNX Nifty rose by 86.05 points or 1.58% to end at 5531.50.

The BSE Sensex touched a high and a low of 18463.84 and 18155.43, respectively. The BSE Mid-cap and Small-cap indices gained 0.49% and 0.26%, respectively.

Reliance Communication up 4.36%, Tata Power up 3.72%, Reliance Infra up 3.48%, Tata Steel up 3.27% and Jaipraksh Associatesup 2.68% were the major gainers on the Sensex.

On the flip side, Bharti Airtel down 0.40%, Hindustan Unilever down 0.16%, ONGC down 0.14% and Hero Honda down 0.06% were the only losers on the index.

India's inflation has surprisingly quickened in the month of February after showing signs of decline in last few months, making the task of the Reserve Bank of India (RBI) tougher.

According to the data released by the ministry of commerce and industry on Monday, the wholesale price index (WPI) inflation, more closely watched than the consumer price index (CPI), advanced 8.31% in the month of February versus 8.23% in January after prices of fuel and manufactured products went higher. The rise in the monthly inflation numbers was unexpected as economists and experts forecasted February inflation number to come at around 7.8% against the annual rise of 8.23% in January. Meanwhile, the ministry revised up December's inflation figure to 9.41% from 8.43% reported initially.

The higher than expected numbers has put the central bank in dilemma after a weak IIP numbers, it has been accused of being 'behind the curve' in fighting inflation and is widely expected to hike the policy rates for the eighth time since last March by at least 25 basis points on March 17 in its mid-quarterly policy review. RBI's Deputy Governor Subir Gokarn had already expressed concerns over high oil prices and indicated that it would put pressure on the RBI's strategy to manage inflation.

Oil &Gas up 2.24%, Metal up 2.01%, IT up 1.48%, Bankex up 1.36% and Power up 1.27% were the major gainers in the BSE sectoral space. There was no loser in the BSE sectoral space.

Steel Authority of India (SAIL), India's largest state-owned iron ore producer, has started the process of developing Chiria reserves in Jharkhand. Hatch Associates of Australia, a consultant of global repute has been appointed for the preparation of detailed project execution report.

The company has initiated the process for development of seven million tonnes per annum capacity mechanized mine with state-of-art technology. The Ministry of Environment and Forests (MoEF) had given forest clearance to SAIL for mining iron ore from Chiria mines last week with stipulated conditions.

As per conditions stipulated in the stage-1 forest clearance, only mining and crushing up to secondary stage will be carried out at Chiria mine. Balance activities like processing plant will be carried out outside the forest area.

Asserting that mineral rich Chiria reserves belongs to it, state-owned SAIL had last month said that it was hopeful of commencing mining iron ore from the mines by 2012-13.

The S&P CNX Nifty touched a high and a low of 5,537.30 and 5,434.25, respectively.

The top gainers on the Nifty were Reliance Capital up 9.90%, RCOM up 5.66%, BPCL up 4.68%, GAIL up 3.98% and Reliance Infra up 3.75%.

The only losers on the index were Suzlon down 2.73%, ONGC down 0.23%, Bharti Airtel down 0.09% and Siemens down 0.03%.

European markets were trading mixed on Monday. France's CAC 40 declined 0.12%, Germany's DAX dropped 0.91% and Britain's FTSE 100 rose by 1.00%.

Asian equity indices finished the day's trade on the mixed note on Monday. Japanese Nikkei plummeted more than six percent as investors reacted to the biggest earthquake in the country's history, a devastating tsunami and an unfolding nuclear emergency. Shares tumbled below as the key index fell below the 10,000 point mark. The day's plunge in the Nikkei-225 was the biggest since October 2008. However, Hong Kong and Shanghai shares ended higher as steel makers and construction firms were boosted by hopes for strong demand.