Domestic indices trade flat with positive bias in volatile session

Indian equity benchmarks made cautious start on Monday amid mixed global cues. Markets soon turned volatile and are trading flat with positive bias in early deals. Initially, market participants were concerned with report that the outflow of funds from domestic markets has continued as Foreign Portfolio Investors (FPI) remain net sellers. So far in the month of May, FPIs have pulled out Rs 37,216 crore as headwinds such as tighter monetary policy and rising inflation force investors towards safer havens. However, downside remained capped as the commerce and industry ministry said that total foreign direct investment into India rose 2 per cent to the highest ever $83.57 billion in 2021-22 on account of various measures like policy reforms and ease of doing business taken by the government.

On the global front, most of the Asian markets are trading lower following the lack of major cues from Wall Street on Friday, as the proposed relaxation of COVID-19 lockdowns in China and China's latest measure to bolster its economy injected a note of optimism. Meanwhile, concerns remain about growth outlook against a backdrop of persistent inflation, looming interest rate hikes and the Ukraine war.

Back home, metals stocks were in focus as the government waived customs duty on the import of some raw materials, including coking coal and ferronickel, used by the steel industry, a move which will lower the cost for the domestic industry and reduce the prices. In scrip specific development, L&T traded higher as it is looking to divest its exposure to road and power concessions and incubate digital and e-commerce businesses as part of its new five-year plan ending FY26.

The BSE Sensex is currently trading at 54423.49, up by 97.10 points or 0.18% after trading in a range of 54191.55 and 54637.30. There were 22 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.37%, while Small cap index was up by 0.23%.

The top gaining sectoral indices on the BSE were Auto up by 2.05%, Realty up by 1.36%, Consumer Durables up by 1.35%, Consumer discretionary up by 1.21%, Industrials up by 0.96%, while Metal down by 7.93%, Basic Materials down by 3.04%, Energy down by 0.71%, Oil & Gas down by 0.67%, PSU down by 0.56% were the top losing indices on BSE.

The top gainers on the Sensex were Maruti Suzuki up by 3.06%, Mahindra & Mahindra up by 2.49%, Asian Paints up by 1.87%, Titan Company up by 1.68% and ICICI Bank up by 1.25%. On the flip side, Tata Steel down by 12.28%, ITC down by 2.38%, Power Grid down by 0.83%, Reliance Industries down by 0.54% and Tech Mahindra down by 0.45% were the top losers.

Meanwhile, the commerce and industry ministry has said that total foreign direct investment (FDI) into India rose 2 per cent to the ‘highest ever’ $83.57 billion in 2021-22 on account of various measures like policy reforms and ease of doing business taken by the government. Total FDI comprises equity inflows, reinvested earnings and other capital. In 2020-21, the inflow stood at $81.97 billion. It was $74.39 billion in 2019-20 and $62 billion in 2018-19. It said that the foreign inflows are increasing despite challenges like a military operation in Ukraine and COVID-19 pandemic.

It added that these inflows have increased 20-fold since 2003-04 when the inflows were $4.3 billion only. It also informed that FDI equity inflow in manufacturing sectors has increased by 76 per cent in 2021-22 ($21.34 billion) compared to 2020-21 ($12.09 billion). FDI equity inflows stood at $58.77 billion in 2021-22 against $59.64 billion in 2020-21. It said that in terms of top investor countries, Singapore is at the top with a 27 per cent share, followed by the US (18 per cent) and Mauritius (16 per cent) during the last fiscal.

The ministry added these trends ‘are an endorsement of its status as a preferred investment destination amongst global investors’. Among sectors, computer software and hardware attracted maximum inflows. It was followed by the services sector and automobile industry. Karnataka is the top recipient state with a 38 per cent share of the total FDI equity inflow reported during 2021-22 followed by Maharashtra (26 per cent) and Delhi (14 per cent).

The CNX Nifty is currently trading at 16273.05, up by 6.90 points or 0.04% after trading in a range of 16207.25 and 16349.50. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Maruti Suzuki up by 3.08%, Hero MotoCorp up by 2.67%, Mahindra & Mahindra up by 2.62%, Apollo Hospital up by 2.10% and Asian Paints up by 1.88%. On the flip side, Tata Steel down by 12.37%, JSW Steel down by 10.86%, Hindalco down by 5.69%, ITC down by 2.36% and ONGC down by 2.07% were the top losers.

Asian markets are trading mostly in red; Straits Times declined 15.76 points or 0.49% to 3,224.82, Hang Seng slipped 401.00 points or 1.94% to 20,316.24, KOSPI lost 0.89 points or 0.03% to 2,638.40, Jakarta Composite fell 43.14 points or 0.62% to 6,875.00 and Shanghai Composite was down by 14.77 points or 0.47% to 3,131.80. On the other hand, Nikkei 225 rose 165.15 points or 0.62% to 26,904.18 and Taiwan Weighted was up by 57.04 points or 0.35% to 16,201.89.