Indian markets trade flat with positive bias in early deals; Nifty hits 23K mark for first time

Indian equity benchmarks made negative start on Friday following the broadly sell-off on Wall Street overnight as well as weakness in Asian counterparts after the recent release of stronger-than-expected US economic data and the slightly hawkish Fed minutes renewed concerns the US Fed will keep interest rates higher for longer than previously thought. The concerning escalation in the tensions between Taiwan and China is also weighing on the markets. Markets soon recovered from losses and are hovering around neutral lines. During the trade, Nifty hits 23,000 mark for first time, while Sensex touched 75,500 level. Some support came amid foreign fund inflows. Foreign institutional investors turned buyers on May 23 as they bought Indian equities worth Rs 4,670.95 crore. However, upside remained capped as some cautiousness came in with report that India's engineering exports declined 3.2 per cent to $8.67 billion in April 2024, primarily due to lower shipments of metals, especially iron, steel and copper. The lower shipment of steel was mainly witnessed in Italy, Nepal, the UAE, the Netherlands, the USA, China, and South Korea, among others.

On the sectoral front, road industry stocks are in focus as ratings agency CRISIL Ratings (Crisil) said despite tepid exports, the revenues of road transport fleet operators are likely to grow by 9-11 per cent in 2024-25 (FY25) on the back of better domestic demand. The agency expects operating margins of fleet operators to increase by 75-100 basis points (bps) in the ongoing fiscal year. In stock specific development, NTPC rose and Hindalco Industries rallied ahead of their earnings results.

The BSE Sensex is currently trading at 75480.67, up by 62.63 points or 0.08% after trading in a range of 75244.22 and 75582.28. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.04%, while Small cap index was up by 0.37%.

The top gaining sectoral indices on the BSE were Telecom up by 1.82%, Capital Goods up by 0.68%, Industrials up by 0.61%, Metal up by 0.41% and Utilities up by 0.39%, while Healthcare down by 0.42%, FMCG down by 0.34%, Energy down by 0.26%, Oil & Gas down by 0.17% and Auto down by 0.15% were the top losing indices on BSE.

The top gainers on the Sensex were Larsen & Toubro up by 1.30%, Bajaj Finance up by 0.81%, Tata Steel up by 0.80%, SBI up by 0.75% and Bharti Airtel up by 0.66%. On the flip side, Sun Pharma down by 0.69%, TCS down by 0.65%, ICICI Bank down by 0.56%, Mahindra & Mahindra down by 0.55% and Titan Company down by 0.51% were the top losers.

Meanwhile, with lower shipments of metals, especially iron, steel and copper, India's engineering exports declined 3.2 per cent to $8.67 billion in April 2024. The growth of engineering exports has been steady in the past four months. The lower shipment of steel was mainly witnessed in Italy, Nepal, the UAE, the Netherlands, the USA, China, and South Korea, among others. Notably, engineering exports to the USA increased 1.2 per cent year-on-year to $1.41 billion in April this year. The value of shipments to Saudi Arabia was higher by 48.9 per cent in April 2024, at $435.72 million, as against $292.72 million in April 2023. Engineering exports to China went up 14.8 per cent to $210.29 million from $183.24 million in the same month last year. Engineering exports recorded a growth of 2.61 per cent during April 2024, excluding the export of iron and steel.

The exports of both metals declined by a substantial 36.41 per cent, which was the single biggest reason behind the fall seen during the current month. The decline in engineering exports was witnessed in almost all regions, barring North America, North East Asia, WANA, and the CIS. Among top exporting destinations, the USA, Saudi Arabia, UAE, Singapore, UK, Mexico, and China experienced positive growth in April 2024, while Germany, Italy, Turkey, South Korea, Japan, Nepal, Brazil, Thailand, France, Bangladesh, and many more saw negative export growth. A high base effect caused a decline in engineering exports to Russia, as exports to the country stood at $118.56 million in April 2024, 9.4 per cent lower compared to $130.91 million in the corresponding period last year.

Region-wise, North America and the European Union remained India's topmost destinations for engineering exports, with a share of 21.1 per cent and 18.4 per cent, respectively, in India's total engineering exports. North East Asia registered the highest growth of 24.5 per cent during April 2024 vis-a-vis the same period last year, followed by CIS (growth of 7.9 per cent), North America (growth of 4.7 per cent), and WANA (growth of 3.1 per cent). All remaining regions witnessed negative growth in exports. India's total engineering goods exports in the financial year ended March 2024 had risen marginally to $109.32 billion from $107.04 billion in FY2022-23, despite numerous challenges.

The CNX Nifty is currently trading at 22972.30, up by 4.65 points or 0.02% after trading in a range of 22908.00 and 23004.05. There were 19 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 1.88%, Larsen & Toubro up by 1.33%, Wipro up by 0.90%, Bajaj Finance up by 0.88% and SBI up by 0.84%. On the flip side, Adani Ports & SEZ down by 2.47%, Tata Consumer Products down by 1.30%, Shriram Finance down by 1.12%, Apollo Hospital down by 0.92% and Hero MotoCorp down by 0.92% were the top losers.

Asian markets are trading in red; Nikkei 225 slipped 410.23 points or 1.05% to 38,692.99, Hang Seng declined 239.61 points or 1.27% to 18,629.10, KOSPI dropped 26.84 points or 0.99% to 2,694.97, Taiwan Weighted lost 17.8 points or 0.08% to 21,589.63, Straits Times fell 15.68 points or 0.47% to 3,306.94 and Shanghai Composite was down by 4.89 points or 0.16% to 3,111.50.