Sensex, Nifty Set For Positive Start As Bank Worries Ease

(RTTNews) - Indian shares are seen opening higher on Tuesday as investors react to positive global cues and await the outcome of a two-day policy meeting of the Federal Reserve that gets underway later today.

Oil and gas stocks could be in focus today after the Centre cut the windfall tax on the locally produced crude oil to Rs. 3,500 per ton and raised the export duty on diesel to Rs. 1 per litre from Rs. 0.50.

Meanwhile, the Adani Group clarified that financial closure of the Green PVC project of its Mundra Petrochemicals Limited is pending with financial institutions and hence the procurement of major equipment and construction activities at the site have been put on hold.

Benchmark indexes Sensex and Nifty dropped around 0.6 percent and 0.7 percent, respectively on Monday, while the rupee fell by 4 paise to close at 82.63 against the dollar.

Asian stocks were mostly higher, with Japanese markets closed for a holiday. The dollar held steady after falling to a five-week low overnight as bond markets whipsawed.

Gold was slightly higher at $1,981.19 per ounce, after having hit a one-year high of $2,009 an ounce in intraday trading overnight. Oil prices fell again after rebounding from 15-month lows overnight.

Investors await the outcome of central bank meetings in Britain and the United States this week to see whether the banking crisis would force them to put up a dovish stand for less rate hikes.

U.S. stocks closed higher overnight as a forced takeover of Credit Suisse by UBS and joint central bank actions to boost global dollar liquidity helped ease fears of a banking crisis.

The Dow climbed 1.2 percent, the tech-heavy Nasdaq Composite rose 0.4 percent and the S&P 500 advanced 0.9 percent.

European stocks shrugged off early weakness to finish higher on Monday.

The pan European STOXX 600 gained 1 percent after ECB President Christine Lagarde's assurance that Eurozone banks have capital and liquidity levels well beyond their requirements.

The German DAX rallied 1.1 percent, France's CAC 40 index surged 1.3 percent and the U.K.'s FTSE 100 added 0.9 percent.