Benchmarks likely to open in red tracking weakness in global markets

Indian markets ended the week's first trading session in the negative territory on heavy sell-offs from FIIs. Investor sentiment has also been strained by weak quarterly earnings and geopolitical uncertainties. Today, benchmarks are likely to open in red tracking weakness in global markets. Investors around the world, including in India, would have their eyes fixated on the US presidential elections, as the country heads into a closely tracked and even closer to call contest between Republican Donald Trump and Democrat Kamala Harris. Overnight sharp rise in crude oil prices likely to hurt domestic investors. Oil prices climbed nearly 2% on Monday on OPEC+’s decision to delay plans to increase output by a month, while the market braced for a critical week in which Americans will elect a new president. Continued foreign fund outflows likely to dent sentiments in the markets.  As per NSE data, Foreign Institutional Investors (FII) were net sellers of Indian equities worth Rs 4,329.79 crore. Separately, the Securities and Exchange Board of India (Sebi) has allowed mutual funds (MFs) to invest in overseas funds and unit trusts (UTs) that have up to 25 per cent exposure to Indian equities. The decision opens scope for domestic funds to invest in prominent global schemes, especially passive ones, which provide exposure to markets across the globe. Renewable energy stocks will be in focus after Minister of New and Renewable Energy, Pralhad Joshi said India is on its way to achieving the target of 500 gigawatts of renewable energy by 2030. Joshi said India’s solar rooftop initiatives is one of the best schemes to encourage renewable energy usage. There will be some reaction in coal stocks as Union Minister G Kishan Reddy said state-owned CIL's priorities should be to ramp up production of coal and scale up supplies to reduce imports. Coal India accounts for over 80 per cent of domestic coal output. The minister stressed upon the importance of miners' welfare and the rehabilitation of communities affected by mine closures. Meanwhile, Dr Reddy's Labs, Titan, PB Fintech, Mankind Pharma, Mazagon Dock Shipbuilders, Oil India, GAIL, Berger Paints, JK Tyre, Max Healthcare Institute, Raymond Lifestyle, SJVN and Sundram Fasteners, among others will release their September quarter results today. In the primary market, Sagility India’s initial public offer (IPO) will open for application today.

The US markets ended lower on Monday as investors prepared for a crucial week in which Americans will elect a new president and the Federal Reserve will announce its policy statement. Asian markets are trading mixed on Tuesday tracking overnight fall on Wall Street.

Back home, Indian equity benchmarks hit with a sharp fall on Monday’s trading session as investors exercised caution ahead of the US presidential election and awaited upcoming economic decisions from global central banks. After a cautious start, markets remained under selling pressure for the whole day, as sustained foreign fund outflows dented sentiments. Foreign investors pulled out a massive Rs 94,000 crore (around $11.2 billion) from the Indian stock market in October, making it the worst-ever month in terms of outflows, triggered by the elevated valuation of domestic equities and attractive valuations of Chinese stocks. Besides, the RBI said India's forex reserves dropped by $3.463 billion to $684.805 billion in the week ended October 25. Losses got intensified during the middle of the session, amid a private report stating that India’s economic growth likely moderated in July-September, primarily due to a slowdown in consumption and investment amid heavy monsoon rains in several parts of the country. Towards end of the session, indices staged minor recovery, as some relief came after India's manufacturing sector regained growth momentum in the month of October, fuelled by faster increases in total new orders and international sales. According to the survey report, the seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) surged to 57.5 in October as against 56.5 in September, indicating a substantial and accelerated improvement in operating conditions. On the sector front, auto stocks remained in focus after auto sales data released for October. As per a private report, in wholesale terms, the passenger vehicle sector recorded a modest 1.8 per cent increase from the previous year, to a total of 401,447 units. Retail sales posted a 20 per cent rise on the festive push. Besides, stocks related to the power industry were in focus, as India's power consumption rose marginally by about one per cent to 140.47 billion units (BU) in October 2024 as compared to a year ago, mainly due to heavier base effect. In the year-ago period, the power consumption grew by over 22 per cent to 139.44 BU from 113.94 BU in October 2022. Finally, the BSE Sensex fell 941.88 points or 1.18% to 78,782.24, and the CNX Nifty was down by 309.00 points or 1.27% to 23,995.35.