Sensex, Nifty trade tad lower with volatility in early deals

Indian equity benchmarks made a cautious start on Wednesday as traders remained cautious amid the lack of concrete progress toward a broader trade agreement between the US and its trading partners, despite reaching temporary deals with some. Sensex and Nifty are trading tad lower with volatility in early deals ahead of the release of industrial and manufacturing production data for April to be out later in the day. Some cautiousness came as the government data showed that Foreign direct investment (FDI) equity inflow in India fell 24.5 per cent year-on-year to $9.34 billion in the January-March quarter of 2024-25 but grew 13 per cent at $50 billion during the entire previous financial year.

On the global front, Asian are trading mostly higher following the broadly positive cues from Wall Street overnight after President Trump agreed to delay a threatened 50 percent tariffs on imports from the European Union and data showed U.S. consumer confidence rebounded sharply in May after a prolonged decline. Back home, coal stocks are in focus as Ministry of Coal said that India's coal imports fell by 7.9 per cent, totalling 243.62 million tonnes (MT), compared to 264.53 MT during the just-concluded financial year 2024-25. In stock specific development, ITC declined on reports that British American Tobacco will offload 2.3 percent stake in the company through a block deal.

The BSE Sensex is currently trading at 81346.14, down by 205.49 points or 0.25% after trading in a range of 81259.10 and 81613.36. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.03%, while Small cap index was up by 0.31%.

The top gaining sectoral indices on the BSE were Telecom up by 1.22%, Realty up by 0.37%, TECK up by 0.29%, IT up by 0.22% and Power up by 0.22%, while FMCG down by 1.25%, Consumer Durables down by 0.69%, Auto down by 0.56%, Consumer discretionary down by 0.37% and Metal down by 0.36% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 0.54%, Infosys up by 0.40%, Adani Ports & SEZ up by 0.25%, ICICI Bank up by 0.23% and NTPC up by 0.21%. On the flip side, ITC down by 2.97%, Titan Co down by 1.08%, Mahindra & Mahindra down by 0.94%, Asian Paints down by 0.70% and Maruti Suzuki down by 0.63% were the top losers.

Meanwhile, the government data has said that foreign direct investment (FDI) equity inflow in India fell 24.5 per cent year-on-year (Y-o-Y) to $9.34 billion in the January-March quarter of 2024-25 but grew 13 per cent at $50 billion during the entire FY25. FDI equity inflows during Q4FY24 stood at $12.38 billion. These were $44.42 billion in FY24. During the October-December quarter of 2024-25 also, the inflows were contracted by 5.6 per cent Y-o-Y to $10.9 billion due to global economic uncertainties.

Total FDI, which includes equity inflows, reinvested earnings and other capital, grew by 14 per cent to $81.04 billion during the last financial year. It is the highest in the last three years. The same stood at $71.3 billion in 2023-24. During 2024-25, Singapore emerged as the largest source of FDI with $14.94 billion inflows. It was followed by Mauritius ($8.34 billion), the US ($5.45 billion), the Netherlands ($4.62 billion), the UAE ($3.12 billion), Japan ($2.47 billion), Cyprus ($1.2 billion), UK ($795 million), Germany ($469 million), and Cayman Islands ($371 million).

However, the data showed that when compared to 2023-24, the inflows had declined from the Netherlands, Japan, the UK, and Germany. Singapore accounts for 30 per cent share, Mauritius (17 per cent) and the US (11 per cent). Sectorally, inflows rose in services, trading, telecommunication, automobile, construction development, non-conventional energy and chemicals. However, it has contracted in computer software and hardware, construction (infrastructure activities), and pharmaceuticals.

FDI in services has increased to $9.34 billion during 2024-25 as against $6.64 billion in 2023-24. According to the data, FDI inflows in non-conventional energy stood at $4 billion as against $3.76 billion in 2023-24. The data also showed that Maharashtra received the highest inflow of $19.6 billion during the last financial year. It was followed by Karnataka ($6.61 billion), Delhi ($6 billion), Gujarat (about $5.7 billion), Tamil Nadu ($3.68 billion), Haryana ($3.14 billion), and Telangana ($2.99 billion).

The CNX Nifty is currently trading at 24782.15, down by 44.05 points or 0.18% after trading in a range of 24743.05 and 24864.25. There were 18 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were HDFC Life Insurance up by 0.81%, JIO Financial Services up by 0.62%, Bharti Airtel up by 0.61%, Infosys up by 0.47% and ICICI Bank up by 0.35%. On the flip side, ITC down by 2.81%, Nestle down by 1.32%, Tata Consumer Products down by 1.11%, Titan Company down by 0.98% and JSW Steel down by 0.87% were the top losers.

Asian markets are trading mostly in green; Nikkei 225 surged 105.94 points or 0.28% to 37,830.05, Taiwan Weighted added 64.83 points or 0.3% to 21,401.37, KOSPI increased 44.53 points or 1.66% to 2,681.75, Straits Times rose 19.02 points or 0.49% to 3,915.11 and Shanghai Composite was up by 2.24 points or 0.07% to 3,342.93. On the other hand, Hang Seng declined 127.54 points or 0.55% to 23,254.45 and Jakarta Composite was down by 8.67 points or 0.12% to 7,190.30.