Corporate earnings for the December quarter have been the worst since the global financial crisis, leading to a sense of frustration within India Inc. That is because the effects of policy reforms are still not visible on the ground. Morgan Stanley’s Ridhan Desai however feels the earnings data does not reflect the complete picture and that the capex cycle is slowly picking up.

“Fixing inflation has caused growth to weaken in the short run (inevitable pain), but has set up India for better growth in the coming months. Remedying stalled projects was a more complex problem, but recent capex data shows that things are turning,” writes Desai in a Morgan Stanley note to clients.

The sharemarket has opened the most crucial Budget week on a firm note.The Sensex is up 65.28 points at 29296.69 and the Nifty is up 23.25 points at 8856.85. About 500 shares have advanced, 126 shares declined, and 119 shares are unchanged. Hindalco, Tata Power, BHEL, Infosys and Tata Steel are top gainers in the Sensex.

Among the losers are Reliance, ITC, Bajaj Auto and Dr Reddy’s Labs. The Indian rupee opened flat at 62.20 per dollar versus 62.22 Friday. The euro held steady, rising initially in relief following a conditional loan extension deal for Greece, but losing steam as caution towards the debt saga persisted. Pramit Brahmbhatt of Veracity said, “Investors are likely to be cautious ahead of a series of data due for the week. Rupee is expected to trade rangebound to slightly weak taking cues from a strong dollar.

Range for the rupee is seen between 61.80-62.80/dollar.” Global cues are positive with the Wall Street having closed at record highs after Greece got yet another lifeline as the Euro-group agreed to extend the bailout package by four months, contingent on reform measures by Greece. Asian markets are positive in morning trade but volumes are low with China, Taiwan markets being closed for the Chinese New Year holiday.

Coustery : http://www.moneycontrol.com/news/local-markets/sensex-nifty-firm-hindalco3-relianceitc-drag_1310740.html