Markets likely to get flat-to-positive start amid mixed global cues

Indian markets crashed on Monday, hammered by robust selling in market heavyweights Infosys and HDFC Bank following their below-estimate results. Today, the markets are likely to get flat-to-positive start amid mixed global cues. Some support will come as the commerce department’s preliminary data showed that India exported goods worth $18.79 billion during the first two weeks of April, up 37 per cent compared to the same period last year, as external demand continued to remain robust. Excluding petroleum products, the growth in this period was 23.64 per cent over the same period of 2021-22. Besides, Agriculture Minister Narendra Singh Tomar has launched two new portals, with an aim to improve ease of doing business, including one for registration of pesticides. Another portal is for documentation related to imports and exports of agri-products and plants. However, there may be some cautiousness as flagging risks of disruptive spillovers from geopolitical hostilities, an RBI article said India faces these challenges from a position of strength built on broadened vaccine coverage, financial sector resilience and robust exports. Traders may be concerned as the International Monetary Fund (IMF) warned that the debt piled on by the private sector during the coronavirus pandemic could lower growth for emerging markets by 1.3 percent over three years. There will be some buzz in the aviation industry stocks as Civil Aviation Minister Jyotiraditya Scindia expressed confidence about India's aviation industry getting back to the normal pre-pandemic level. The aviation industry of India touched over four lakh domestic passengers in a day on April 18, 2022. Sugar industry stocks will be in focus as the commerce ministry said India’s sugar exports increased to $4.6 billion (about Rs 35,000 crore) in 2021-22 from $1.17 billion (about Rs 9,000 crore) in 2013-14. India exported sugar to 121 countries across the globe. There will be some reaction in real estate sector stocks with a private report that private equity investment into the Indian real estate sector fell 47 per cent to $1 billion during January-March this year compared to the year-ago period, but the inflows jumped over 4.5 times from the previous quarter. There will be some important result announcements to keep the markets in action.

The US markets ended in red on Monday as worries about interest rates and inflation keep a lid on Wall Street despite some better-than-expected profit reports. Asian markets are trading mixed on Tuesday with investors weighing Chinese measures to support the economy and the prospect for faster Federal Reserve policy tightening to fight inflation.

Back home, Indian equity benchmarks extended the losing run to the fourth straight session and ended with heavy losses on Monday, dragged down by heavyweights Infosys and HDFC twins amid a weak trend in Asian markets. Markets began trade on weak note and stayed in red for whole day, as traders remained cautious as the World Bank cut its economic growth forecast for India and the whole South Asian region, citing worsening supply bottlenecks and rising inflation risks caused by the Ukraine crisis. The international lender lowered its growth estimate for India to 8% from 8.7% for the current fiscal year to March, 2023. Additional pressure came in with a private report stating that with Covid cases witnessing a rise in the national capital, traders and business owners are apprehensive that their pandemic-hit businesses might be engulfed in another wave even before recovering from losses over the past two years. Markets extended fall in afternoon deals, as India’s March wholesale price index-based inflation rose to 14.55 per cent as compared to 13.11 per cent in last month. According to the data released by the industry department, the high rate of inflation in March 2022 was primarily due to rise in prices of crude petroleum and natural gas, mineral oils, basic metals, owing to disruption in global supply chain caused by Russia-Ukraine conflict. Traders overlooked the finance ministry’s statement that the focus on capex in the recently announced Budget for the current fiscal year will boost manufacturing and tax revenue collections, thereby keeping India on track to becoming a $5 trillion economy. Market participants also paid no heed towards a private report stated that a normal monsoon season this year is expected to mitigate some inflationary pressures, especially being witnessed in certain food commodities. In terms of predictions, both Skymet and IMD have given a forecast for a 'normal' Southwest Monsoon for the current year at 99 per cent and 98 per cent of the long period average (LPA) respectively. Finally, the BSE Sensex fell 1172.19 points or 2.01% to 57,166.74 and the CNX Nifty was down by 302.00 points or 1.73% to 17,173.65.