Domestic indices trade flat in late morning deals

Domestic equity markets were trading flat in late morning deals amid weak cues from other Asian markets. Meanwhile, broader indices were trading mixed with BSE Mid cap index gaining 0.19%, while Small cap index fell by 0.13%. Traders were cautious amid lingering uncertainty about the outlook for interest rates, with U.S. Fed officials warning the central bank may still need to raise rates if inflation persists. Further, foreign fund outflows also dented sentiments. Foreign institutional investors continue to sell Indian equities, with net sales of Rs 92.95 crore worth of shares on May 18. On the BSE sectoral front, traders were seen pilling up position in Metal, PSU, Utilities, Power and Basic Materials, while selling was witnessed in FMCG, IT, TECK, Healthcare and Auto. 

On the global front, Asian markets were trading in red amid elevated geopolitical tensions and lingering uncertainty over the timing and pace of Fed rate cuts. Back home, in the stock specific development, Indian Railway Finance Corporation (IRFC) rose after the company reported strong net profits in the fourth quarter of financial year 2023-24 (Q4FY24). 

The BSE Sensex is currently trading at 73946.51, down by 59.43 points or 0.08% after trading in a range of 73762.37 and 73987.47. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was up by 0.19%, while Small cap index down by 0.13%.

The top gaining sectoral indices on the BSE were Metal up by 3.12%, PSU up by 1.91%, Utilities up by 1.70%, Power up by 1.34% and Basic Materials up by 1.13%, while FMCG down by 0.69%, IT down by 0.61%, TECK down by 0.29%, Healthcare down by 0.22% and Auto down by 0.15% were the top losing indices on BSE.

The top gainers on the Sensex were JSW Steel up by 3.10%, Tata Steel up by 2.89%, Power Grid up by 2.02%, Asian Paints up by 1.37% and NTPC up by 1.36%. On the flip side, Nestle down by 1.57%, TCS down by 0.86%, HCL down by 0.79%, Hindustan Unilever down by 0.73% and Infosys down by 0.63% were the top losers.

Meanwhile, Secretary in Department for Promotion of Industry and Internal Trade (DPIIT) Rajesh Kumar Singh has said that India has recently relaxed foreign direct investment (FDI) norms in the space sector and there is a possibility of further FDI liberalisation in certain other areas when the new government will come to power. He said that in the last few years, India has liberalised FDI policy in many segments. India has one of the most liberal FDI policies in the world and in fact more liberal than many Southeast Asian countries that the country is often compared with.

The Secretary further said the government has eased FDI norms in the space sector by allowing 100 per cent overseas investment in making components for satellites, as part of efforts to attract overseas players and private companies into the segment. According to the government data, FDI in India declined 13 per cent to $32.03 billion in April-December 2023, dragged down by lower infusion in computer hardware and software, telecom, auto, and pharma sectors.

Talking about the success of the production linked incentive schemes (PLI), he said so far Rs 1.13 lakh crore of investments have come in and the beneficiary companies have recorded over Rs 9 lakh crore of sales, exports of Rs 3.45 lakh crore and created jobs for over 8 lakh people. The scheme was announced in 2021 for 14 sectors, including telecommunication, white goods, textiles, manufacturing of medical devices, automobiles, speciality steel, food products, high efficiency solar PV modules, advanced chemistry cell battery, drones, and pharma with an outlay of Rs 1.97 lakh crore.

The CNX Nifty is currently trading at 22512.05, up by 10.05 points or 0.04% after trading in a range of 22404.55 and 22515.25. There were 26 stocks advancing against 24 stocks declining on the index.

The top gainers on Nifty were Coal India up by 4.23%, Hindalco up by 3.40%, JSW Steel up by 2.87%, Tata Steel up by 2.80% and Adani Ports up by 2.19%. On the flip side, Nestle down by 1.71%, HCL down by 0.87%, TCS down by 0.87%, HDFC Life Insurance down by 0.83% and SBI Life Insurance down by 0.80% were the top losers.

All Asian markets were trading lower; Hang Seng declined 360.52 points or 1.87% to 19,275.70, Jakarta Composite plunged 38.77 points or 0.54% to 7,227.92, Shanghai Composite weakened 8.76 points or 0.28% to 3,162.39, Straits Times fell 13.47 points or 0.41% to 3,300.58, KOSPI dropped 20.51 points or 0.75% to 2,721.63, Nikkei 225 slipped 104.39 points or 0.27% to 38,965.29 and Taiwan Weighted lost 34.88 points or 0.16% to 21,236.75.