Markets likely to get cautious start amid mixed global cues

Indian markets ended range-bound session with slim gains on Wednesday as selling pressure in information technology (IT) stocks intensified in the fag-end. Today, markets are likely to get cautious start amid mixed global cues. Foreign fund outflows likely to dent sentiments. Foreign institutional investors (FIIs) net sold shares worth Rs 2,511.74 crore on April 24, provisional data from the NSE showed. However, some support may come with a private report that merger and acquisition (M&A) deal value soared by 60 per cent to USD 19.6 billion in January-March 2024, while that of private equity (PE) experienced a slight dip. With 455 deals amounting to $25.6 billion disclosed value, the first quarter of 2024 showcases a 24 per cent rise in deal volume compared to the fourth quarter of calendar year 2023 - marking a notable resurgence. Meanwhile, the Reserve Bank of India (RBI) has issued Master Direction to the Asset Reconstruction Companies. An Asset Reconstruction Company (ARC) is a financial institution that buys the Non-Performing Assets (NPA) or bad assets from banks and financial institutions so that the latter can clean up their balance sheets. There will be some buzz in pharma industry stocks with the commerce ministry data showing that the country's drugs and pharmaceuticals exports increased 9.67 per cent year-on-year to $27.9 billion in 2023-24, even as the total exports dipped by 3 per cent in the last fiscal. In 2022-23, the exports stood at $25.4 billion. As per the data, pharma exports in March grew by 12.73 per cent to $2.8 billion. IT sector stocks will be in focus as Crisil Ratings said the Indian IT services sector is staring at a second consecutive year of muted revenue growth due to modest increase in tech spends in Europe and the US. It expects the sector to grow at 5-7 per cent in FY25, after a growth of 6 per cent estimated to have been achieved in FY24. There will be some reaction in sugar industry stocks with report that the government has allowed sugar mills to use 6.7 lakh tonnes of B-heavy molasses as feedstock for making ethanol in the current year. The move comes following the industry's representations to the food ministry to allow B-heavy molasses for ethanol production and improve the finances of the sugar mills. On the earnings front, Nestle India, Tech Mahindra, Bajaj Finance, Indusind Bank, Glenmark Life Sciences, Coromandel International, Cyient, L&T Technology Services, Laurus Labs, Mphasis, Schaeffler India, Tanla Platforms, UTI Asset Management Co., and Zensar Technologies will report their Q4FY24 results today, April 25, 2024.

The US markets ended mostly in green with marginal gains on Wednesday as investors weighed an uptick in Treasury yields amid positive corporate results particularly from technology giants. Asian markets are trading mixed on Thursday mirroring moves on Wall Street ahead of the US first-quarter gross domestic product figures due on April 25.

Back home, Indian equity benchmarks ended marginally higher on Wednesday driven by gains in select heavyweights including JSW Steel, Tata Steel and Power Grid, amid broadly positive global cues. Markets made a positive start and extended gains as the day progressed, as traders took some support with a private report that India's GDP growth is likely to average 7% from 2024-25 to 2029-30. Some support also came with report stating that the government is formulating action plans for as many as 20 agricultural products including banana, mangoes, potato and baby corn with a view to further boost export of these commodities. Traders took note of an article in the Reserve Bank of India's (RBI) monthly bulletin released that to achieve its developmental goals over the next three decades, the Indian economy must grow at a rate of 8-10 per annum over the next decade to reap the demographic dividend that started accruing from 2018 and, as calculations show, will last till 2055. However, markets trimmed some gains in late afternoon deals, as traders turned cautious with the Reserve Bank of India’s (RBI) latest bulletin stating that extreme weather events along with prolonged geopolitical tensions could pose a risk to India’s inflation trajectory, even as growth in the South Asian nation exhibits an uptrend. It said food price pressures have been interrupting the ongoing disinflation process even as shocks from adverse climate events and geopolitical tensions add uncertainties to the outlook. Some concern also came as the country's agriculture exports declined by 8.8 per cent to $43.7 billion during April-February period of 2023-24 fiscal due to factors like the Red Sea crisis, Russia-Ukraine war, and domestic restrictions imposed on critical items like rice, wheat, sugar and onion. According to the data of the commerce ministry, the exports stood at $47.9 billion in April-February 2022-23. Finally, the BSE Sensex rose 114.49 points or 0.16% to 73,852.94 and the CNX Nifty was up by 34.40 points or 0.15% points to 22,402.40.