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Markets end lower on heavy foreign fund outflows
May-09-2024

Indian equity benchmarks ended with heavy losses of around one and half percent on Thursday, with Sensex and Nifty closing below their crucial psychological levels of 72,450 and 22,000, respectively. Selling pressure from foreign investors, coupled with uncertainty around the country's ongoing elections have kept investors jittery. According to the provisional data available on the NSE, Foreign institutional investors (FII) offloaded shares worth net Rs 6,669.10 crore on Wednesday. Markets made cautious start and stayed under pressure throughout the day, as traders remain concerned with a private report stating that India's consumer price inflation is likely to have eased to 4.80% in April, just shy of March's rate as food inflation remains sticky. As per the report, with parts of the country experiencing a heatwave, food prices continue to pose an additional risk to India's inflation trajectory.

Markets saw further fall in the second half of the trade and ended near their intraday low points, as domestic sentiments got hit after the Reserve Bank of India (RBI) in its latest data report showed that India’s outward foreign direct investment (OFDI) commitments declined 18.29% to $2943.98 million in April 2024 as compared to $3602.95 million in April 2023. In March 2024, it stood at $3,963.94 million. Traders also failed to draw any sense of relief from Chief Economic Adviser V Anantha Nageswaran’s statement that there was a high possibility of GDP growth touching 8 per cent in FY24 on the back of robust growth registered during the three quarters of the financial year ended March 2024. India’s gross domestic product (GDP) grew by 8.4 per cent in the third quarter ended December 2023. 

On the global front, European markets were trading higher as Chinese and Hong Kong markets advanced on the back of strong trade data. China's exports rebounded more than expected in April on lower base of comparison. Exports advanced 1.5 percent on a yearly basis in April, faster than the 1.0 percent expected growth and reversing March's 7.5 percent decrease. Imports posted an annual increase of 8.4 percent. Asian markets ended mostly down on Thursday as cautious undertone prevailed as uncertainty over Fed rate cuts deepened, and fighting and bombardment continued on the outskirts of the southern Gaza city of Rafah. 

Finally, the BSE Sensex fell 1062.22 points or 1.45% to 72,404.17, and the CNX Nifty was down by 345.00 points or 1.55% points to 21,957.50.

The BSE Sensex touched high and low of 73,499.49 and 72,334.18 respectively. There were 5 stocks advancing against 25 stocks declining on the index.

The broader indices ended in red; the BSE Mid cap index fell 2.01%, while Small cap index was down by 2.41%.

The lone gaining sectoral index on the BSE was Auto up by 0.57%, while Oil & Gas down by 3.41%, Capital Goods down by 3.37%, Energy down by 3.23%, Metal down by 3.13% and Industrials down by 2.92% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 1.77%, Mahindra & Mahindra up by 1.37%, SBI up by 1.14%, HCL Technologies up by 0.80% and Infosys up by 0.80%. On the flip side, Larsen & Toubro down by 6.00%, Asian Paints down by 4.68%, JSW Steel down by 3.64%, ITC down by 3.56% and Indusind Bank down by 2.88% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) in its latest data report has showed that India’s outward foreign direct investment (OFDI) commitments declined 18.29% to $2943.98 million in April 2024 as compared to $3602.95 million in April 2023. In March 2024, it stood at $3,963.94 million.

The equity commitments rose to $888.98 million in April 2024 from $780.84 million a year ago. However, they were lower than the $2,038.97 million recorded in March 2024. Debt commitments increased to $817.18 million in April 2024, from $438.51 million in April 2023. However, they were lower than $1,053.17 million in March 2024.

According the report, guarantees for overseas units fell to $1237.82 million in April 2024 from $2383.61 million in April 2023. However, they were substantially higher compared to $871.80 million in March 2024.

The CNX Nifty traded in a range of 22,307.75 and 21,932.40. There were 7 stocks advancing against 43 stocks declining on the index.

The top gainers on Nifty were Hero MotoCorp up by 3.19%, Tata Motors up by 1.77%, Mahindra & Mahindra up by 1.52%, SBI up by 1.13% and Bajaj Auto up by 1.04%. On the flip side, Larsen & Toubro down by 5.65%, BPCL down by 4.52%, Asian Paints down by 4.48%, Coal India down by 4.40% and ONGC down by 3.85% were the top losers.

European markets were trading higher; UK’s FTSE 100 increased 11.52 points or 0.14% to 8,365.57, France’s CAC rose 2.67 points or 0.03% to 8,134.08 and Germany’s DAX gained 71 points or 0.38% to 18,569.38.

Asian markets ended mostly down on Thursday due to lingering uncertainty over possible interest rate cuts in the United States, and fighting and bombardment continued on the outskirts of the southern Gaza city of Rafah. Meanwhile, investors were cautiously awaiting the release of key US CPI data next week. Japanese shares declined, while the yen stabilized after three days of declines as Japan talked up potential currency interventions. Japan's real wages in March fell for the 24th consecutive month, the labour ministry reported. However, Chinese and Hong Kong shares advanced on the back of strong trade data. Exports advanced 1.5% on a yearly basis in April, faster than the 1% expected growth and reversing March's 7.5% decrease, while imports posted an annual increase of 8.4% that also bigger than forecast of 5.4%. Stock market of Indonesia was closed for Ascension Day.

Asian Indices

Last Trade            

Change in Points

Change in %      

Shanghai Composite

3,154.32

25.84

0.82

Hang Seng

18,537.81

223.95

1.21

Jakarta Composite

--

--

--

KLSE Composite

1,601.22

-3.53

-0.22

Nikkei 225

38,073.98

-128.39

-0.34

Straits Times

3,265.95

1.42

0.04

KOSPI Composite

2,712.14

-32.91

-1.21

Taiwan Weighted

20,560.77

-139.74

-0.68
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