Markets likely to get positive start tracking firm trade in Asian counterparts

Indian markets snapped their four-day losing streak and ended higher on Friday amid some short covering and a surge in index heavyweight HDFC Bank. Today, markets are likely to get positive start tracking firm trade in Asian counterparts. Foreign fund inflows likely to aid domestic sentiments. Foreign institutional investors (FIIs) net bought shares worth Rs 129.39 crore on April 19, provisional data from the NSE showed. Sentiments will get a boost as the tax department said that India's net direct tax collections surged by 17.7 per cent year-on-year to Rs 19.58 lakh crore in the fiscal year ended March 2024 and exceeded the revised estimates by Rs 13,000 crore. Some support will come as the Employees' Provident Fund Organisation (EPFO) released its provisional payroll data for February, 2024, indicating a positive trend in employment numbers. According to the data, there has been a net addition of 15.48 lakh members during the month, highlighting a growth in the organised workforce. Traders may take note of Union Finance Minister Nirmala Sitharaman’s statement that India is implementing tailored policies to become an attractive destination for global manufacturing and services. Besides, Sanjiv Puri, president-designate of leading industry body CII, said that India is growing when the world is going through a phase of stress. Meanwhile, the outward Foreign Direct Investment (FDI) by Indian companies stabilised in FY24 after witnessing a fall in FY23. According to finance ministry data, the actual outward FDI inched up a little to $13.75 billion in FY24 from $13.49 billion in the previous financial year (FY23). This stability came after a sharp fall in outward flows in FY23 from $18.52 billion in FY22. However, some cautiousness may come as the Reserve Bank of India data showed that India’s forex reserves contracted by $5.4 billion to $643.16 billion as of April 12. Previously, forex reserves surged by $2.9 billion to an all-time record high of $648.56 billion, for the week ended on April 5, 2024. There will be some reaction insurance industry stocks with report that the new business premium (NBP) of the life insurance industry grew 15.6 per cent in March to Rs 60,214 crore. The premium earned by an insurer from new contracts in a given period is referred to as the new business premium. The largest insurer, the Life Insurance Corporation (LIC) of India, recorded a NBP growth of 26.4 per cent. Private life insurance firms reported a growth of 2.34 per cent in the same month. On the earnings front, Reliance Industries, Rallis India, Mahindra Logistics, Hatsun Agro Product, and Tejas Networks will announce their March quarter earnings today.

The US markets ended mostly in red on Friday as technology stocks continued their struggles this earnings season. Asian markets are trading in green on Monday rebounded from Friday's sell-off as investors look to fresh data points out of China, Japan and South Korea this week.

Back home, snapping the four-day losing streak, Indian equity benchmarks rebounded from early lows to close higher on Friday, on heavy value buying in Banking, Metal and Consumer Durables shares. The markets opened lower and remained in muted move in first half, as traders were cautious with provisional data from the NSE showing that foreign institutional investors (FIIs) net sold shares worth Rs 4,260.33 crore on April 18, 2024. Sentiments remained pessimistic with a report stating that India's trade deficit with the Association of Southeast Asian Nations (ASEAN) has surged, more than doubling since the implementation of the Free Trade Agreement (FTA) in 2010. According to figures released by the Ministry of Commerce and Industry, India's exports to ASEAN member countries stood at $25,627.89 million in the year 2010-11, while imports from these nations amounted to $30,607.96 million. But, the report said the situation has deteriorated significantly over the past decade, with the deficit expanding at an alarming rate. However, benchmark indices wiped off early losses in afternoon deals and edged higher towards the end of trading session as traders found support with report that the International Monetary Fund has applauded India for maintaining fiscal discipline in an election year, saying that the Indian economy is doing well and continues to be the world's bright spot. Krishna Srinivasan, Director, Asia and Pacific Department, at the IMF said ‘At this point in time, India's economy is doing well. Growth at 6.8 per cent is very good. Inflation's coming down. We have to make sure that inflation comes down to target and it is there on a durable basis. Macro fundamentals look pretty good.’ Some support also came as India's Economic Affairs Secretary Ajay Seth to World Bank stated that despite a challenging global scenario, India's economy has shown robust growth over the past year backed by sustained consumption and investment demand. Finally, the BSE Sensex rose 599.34 points or 0.83% to 73,088.33 and the CNX Nifty was up by 151.15 points or 0.69% points to 22,147.00.