While the Indian bourses are closed today on account of Republic Day, here is a brief view of the global markets. Wall Street closed almost unchanged overnight, recovering from early losses as president Barack Obama proposed a five-year freeze on some government spending and called for job creation. Markets in Asia were mixed in morning trade as corporate earnings reports from the US were disappointed investors.

The domestic market opened with modest gains on Tuesday on support from its Asian peers. Trading was volatile as investors were cautious ahead of the Reserve Bank of India’s (RBI) monetary policy and this capped gains in the early session. However, with key interest rates raised less than what analysts expected, the indices touched their intra-day highs soon after the central bank made its announcement. Investors took the opportunity to book profits, resulting in the indices paring all their gains and venturing into negative territory.

The market, which showed promise of a positive closing, saw a reversal in the last hour. Banking, fast-moving consumer goods and realty were hit the hardest as fears crept in about the possibility of further rate hikes in the next couple of months. The Sensex fell 182 points to close at 18,969, while Nifty lost 56 points to close at 5,687. A fresh bout of selling has started and we may see the market head lower, even though the fall may not be significant.

The US markets ended steady on Tuesday as poor quarterly earnings from companies like 3M, Johnson & Johnson and Bank of America pulled down the indices early in the day. The indices recouped their losses following the president’s State of the Union address, in which he proposed a five-year freeze on discretionary spending and called upon industry leaders to create more jobs. In economic news, US consumer confidence rose in January to its highest level in eight months, but single-family home prices fell for a fifth straight month in November.

The Dow shed 3.33 points (0.03%) at 11,977.19. The S&P 500 added 0.34 point (0.03%) at 1,291.18 and the Nasdaq was up 1.70 points (0.06%) at 2,719.25.

Concerns over disappointing quarterly numbers from US companies cast a spell on the Markets in Asia, which were mixed in morning trade. The Seoul market was boosted by news of good gross domestic product growth. GDP in the fourth quarter of 2010 was up a seasonally adjusted 0.5% from the quarter before.

The Shanghai Composite was up 0.53%, the Straits Times gained 0.18%, the Seoul Composite advanced 0.60% and the Taiwan Weighted rose 0.46%. On the other hand, the Hang Seng declined 0.41%, the Jakarta Composite was down 0.24%, the KLSE Composite fell 0.61%, and the Nikkei 225 was down 0.48%.

Back home, India Inc has expressed fears that the Reserve Bank of India (RBI) increasing key policy rates would adversely impact industrial growth, which had slipped to 2.7% in November.

The central bank has hiked its short-term lending and borrowing rates by 25 basis points (0.25%) each with immediate effect to tackle high inflation, signalling further upward movement in the interest rates. The RBI in 2010 raised the key policy rates six times to contain inflation, which shot up to 8.43% in December on high prices of food items, from 7.48% in November.