Markets trade slightly higher in early deals

Indian equity benchmarks made optimistic start on Friday despite mixed cues from Asian peers and continued India-China border tensions. But, soon markets turned volatile and are trading above neutral lines with marginal gains in early deals. Buying in Realty, Energy and Telecom stocks aided the domestic indices, while selling in IT, TECK and Auto counters kept the upside in check. Traders took encouragement with Prime Minister Narendra Modi’s statement that economic indicators show that India is ready for a swift bounce back as business activity and demand are back to the level seen before the Covid-19 pandemic. Adding optimism among market participants the United Nations Conference on Trade and Development (UNCTAD) said that India’s economy could prove the most resilient in South Asia and its large market will continue to attract market-seeking investments to the country even as it expects a dramatic fall in global foreign direct investment (FDI). Though, some volatility came with rising coronavirus cases as India has added nearly 14,000 cases of coronavirus in 24 hours, taking its total to 367,264. Some cautiousness came in as the Asian Development Bank projected India's economy to contract by four per cent in the current financial year against its earlier prediction of a growth of 4% as measures to contain Covid-19 have significantly disrupted activities.

On the global front, Asian markets are trading mixed following the lackluster cues overnight from Wall Street and as worries about the rising number of coronavirus cases in the US and China offset hopes of a quick economic recovery. However, a Chinese health expert said that the coronavirus outbreak in Beijing is under control. Meanwhile, the Bank of Japan will release the minutes from its emergency monetary policy meeting on May 22. At the meeting, the BoJ introduced a new lending program to help small and medium-sized firms and left its target for short-term interest rate and the bond yield target unchanged.

Back home, sugar stocks were in focus with Food Secretary Sudhanshu Pandey’s statement that the government is considering a proposal to increase the minimum selling price (MSP) of sugar from Rs 31 per kg in order to help millers clear cane dues of about Rs 22,000 crore to farmers. In scrip specific developments, IRB Infrastructure Developers rallied as it has achieved the Rs 6,610 crore financial closure for its first and India's largest TOT (toll-operate-transfer) project 'Mumbai Pune Expressway'. On the other hand, MOIL slumped after its quarterly consolidated net profit nosedived 90%. City Union Bank plunged as it reported a net loss of Rs 95 crore for the fourth quarter ended March 31.

The BSE Sensex is currently trading at 34241.38, up by 33.33 points or 0.10% after trading in a range of 34136.39 and 34440.26. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.58%, while Small cap index was up by 0.74%.

The top gaining sectoral indices on the BSE were Realty up by 1.67%, Energy up by 1.09%, Telecom up by 0.87%, Industrials up by 0.82%, Oil & Gas up by 0.78%, while IT down by 0.67%, TECK down by 0.36%, Auto down by 0.31%, Bankex down by 0.14% were the few losing indices on BSE.

The top gainers on the Sensex were Bajaj Finance up by 2.90%, ONGC up by 1.49%, Reliance Industries up by 1.30%, Axis Bank up by 1.22% and Tata Steel up by 1.07%. On the flip side, Infosys down by 1.52%, Mahindra & Mahindra down by 1.34%, HCL Technologies down by 1.23%, HDFC down by 1.09% and ITC down by 0.99% were the top losers.

Meanwhile, Securities and Exchange Board of India (SEBI) in its latest data has showed that the share of foreign portfolio investments (FPIs) in domestic capital markets through participatory notes (P-notes) increased to Rs 60,027 crore at the end of May, making it the second consecutive monthly increase.

Of the total Rs 60,027 crore invested through the route till May, Rs 49,160 crore was invested in equities, Rs 10,606 crore in debt, Rs 159 crore in the derivatives segment and Rs 103 crore in hybrid securities. P-notes investment stood at Rs 57,100 crore, Rs 48,006 crore and 68,862 crore at the end of April 2020, March 2020 and February 2020, respectively.

The investment level had fallen to an over 15-year-low of Rs 48,006 crore at the end of March. The figure at March-end was the lowest level of investment since October 2004, when the total value of P-note investments in Indian markets stood at Rs 44,586 crore. The lower figure in March came amid significant volatility in broader markets on concerns over coronavirus-triggered recession.

The CNX Nifty is currently trading at 10103.60, up by 11.95 points or 0.12% after trading in a range of 10072.65 and 10162.20. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Bajaj Finance up by 3.15%, Bajaj Finserv up by 2.07%, ONGC up by 1.67%, GAIL India up by 1.39% and Sun Pharma up by 1.33%. On the flip side, Infosys down by 1.60%, Mahindra & Mahindra down by 1.26%, HCL Technologies down by 1.17%, ITC down by 1.15% and HDFC down by 1.13% were the top losers.

Asian markets are trading mixed; Nikkei 225 surged 133.48 points or 0.60% to 22,488.94, Taiwan Weighted gained 26.40 points or 0.23% to 11,574.73, Jakarta Composite rose 19.42 points or 0.39% to 4,944.67 and Shanghai Composite jumped 11.42 points or 0.39% to 2,950.74. On the other hand, Straits Times declined 22.56 points or 0.85% to 2,643.10, Hang Seng weakened 16.78 points or 0.07% to 24,448.16 and KOSPI was down by 3.66 points or 0.17% to 2,129.82.