Level of 6,145 on the Nifty may act as support

As we mentioned in Friday’s closing report, Indian benchmark BSE 30-share Sensex and NSE Nifty opened the week lower but continued to march higher and closed at its highest since 24 January 2014. The level of 6,145 for Nifty may act as an indicator for any change in trend. The positive move of Monday remained unaffected by a weak US market on Friday and Asian markets today. On Friday, the existing-home sales in January showed a bigger-than-expected decline, but unusually poor weather may have played a role, the National Association of Realtors said.

The Sensex opened at 20,695 while the Nifty opened at 6,141. Immediately, the indices hit the days low at 20,637 and 6,131, respectively. The upmove continued until the end of the session where the both indices hit day’s high at 20,829 and 6,192. The Sensex closed at 20,811 (up 111 points or 0.53%) while Nifty closed at 6,186 (up 31 points or 0.50%). The NSE recorded a volume of 46.73 crore shares.

Reserve Bank of India (RBI) governor Raghuram Rajan on Sunday said that inflation remains the biggest threat to growth but bringing inflation down is a challenge.

Moody's Analytics, a research arm of Moody's group, on Monday pegged India's gross domestic product growth at 4.8% in the third quarter of the current financial year. Moody's Analytics said most sectors have underperformed as elevated inflation and financial instability have battered confidence and demand. On the positive side, it said the improving global economy will support exports.

The futures and options for February 2014 F&O contracts expire on Wednesday, 26 February 2014. The stock market remains closed on Thursday, 27 February 2014, on account of Mahashivratri.

US indices closed marginally lower.

The National Association of Realtors said existing home sales fell 5.1% in January to an 18-month low. Sales of standing homes have dropped in five of the past six months.

Dallas Federal Reserve President Richard Fisher said the central bank should continue to taper its bond-buying program that's boosted stocks.

Except for NZSE 50 (up 0.85%) and Straits Times (up 0.19%) all the other Asian indices closed in the negative. Shanghai Composite (fell 1.75%) was the top loser.

Industrial Bank Co. and other unidentified banks have curbed lending to the property sector and related industries such as steel and cement, Shanghai Securities News reported as China said new home prices rose in 69 of 70 cities last month from a year before. But the growth in new-home prices in China's first-tier cities slowed in January, National Bureau of Statistics data showed on Monday.

Group of 20 officials ended their summit on Sunday saying they would look to boost world growth by more than $2 trillion over the next few years under a strategy crafted by the International Monetary Fund. The G-20's final communiqué highlights agreement among central banks to communicate their stimulus-exit strategies clearly and in a timely fashion. The communiqué warned that the global economy faces a period of potential "excessive volatility" harmful to growth as countries adjust their economic policies. "We do not want any surprises," Joe Hockey, Australia's treasurer and G-20 host, said at the conclusion of the summit on Sunday.

Meanwhile, European Central Bank President Mario Draghi Sunday signaled the central bank's March policy meeting could be critical in determining whether the ECB will provide more stimulus to the euro-zone economy. However Draghi dismissed deflation fears, however, saying inflation expectations in the euro zone are anchored in line with the central bank's mandate of just less than 2% over the medium term.

German business confidence unexpectedly climbed to the strongest level in 2 1/2 years in a sign that growth in Europe’s largest economy may accelerate. The Ifo institute’s business climate index, based on a survey of 7,000 executives, advanced to 111.3 in February from 110.6 in January. That’s the fourth monthly gain and the strongest reading since July 2011. European indices were trading mixed while US Futures were trading higher.