Image for representational purposes only
| Photo Credit: Reuters

Benchmark indices Sensex and ticked higher for the second straight session on Wednesday (January 15, 2025), buoyed by buying in bellwether stock Reliance Industries, Zomato and Kotak Bank amid a largely firm trend in global markets.

However, elevated crude oil prices in the international markets and buying by foreign investors weighed on market sentiment, traders said.

The 30-share BSE index climbed 224.45 points or 0.29% to close at 76,724.08. During the day, it jumped 491.42 points or 0.64% to 76,991.05.

As many as 2,150 stocks advanced while 1,806 declined and 108 remained unchanged on the BSE.

The NSE Nifty advanced 37.15 points or 0.16% to 23,213.20.

“The domestic market continues to be volatile on account of elevated US bond yields, strengthening dollar, and increasing FIIs outflows. Global markets are cautious ahead of the US December CPI inflation data, which is anticipated to be in the elevated range in the short term, limiting the U.S. Fed’s ability to cut rates.

“Also, a rise in oil prices and dollar appreciation is likely to affect domestic inflation in the near future,” Vinod Nair, Head of Research, Geojit Financial Services, said.

From the Sensex blue-chip pack, Zomato jumped over 4%. NTPC, Power Grid, Kotak Mahindra Bank, Maruti, Tech Mahindra, Larsen & Toubro, Reliance Industries and Adani Ports were the other big gainers.

Mahindra & Mahindra, Bajaj Finserv, Bajaj Finance, Axis Bank and Tata Motors were among the laggards.

The BSE smallcap gauge climbed 0.34%, and the midcap index went up by 0.11%.

Among BSE sectoral indices, utilities jumped 2.45%, power (1.75%), realty (1.58%), services (0.98%), BSE Focused IT (0.74%) and consumer discretionary (0.62%).

Auto, oil & gas, FMCG and healthcare were the laggards.

“Markets traded in a subdued manner and ended marginally higher, extending Tuesday’s trend. The market seems to be pausing as recovery attempts face resistance, though select heavyweight stocks are limiting the downside. Investors are now closely eyeing earnings from Reliance, Infosys, and Axis Bank for directional cues,” Ajit Mishra – SVP, Research, Religare Broking Ltd, said. In Asian markets, Hong Kong settled in the positive territory, while Seoul, Tokyo and Shanghai ended lower.

European markets were quoting higher. U.S. markets ended mostly higher on Tuesday (January 14, 2025).

The rupee settled with a gain of 13 paise at 86.40 (provisional) against the U.S. dollar on Wednesday (January 14, 2025).

Global oil benchmark Brent crude climbed 0.38% to $80.22 a barrel.

Foreign Institutional Investors (FIIs) offloaded equities worth ₹8,132.26 crore on Tuesday (January 14, 2025), according to exchange data.

In the previous session, the BSE benchmark rose 169.62 points or 0.22% to settle at 76,499.63. The Nifty climbed 90.10 points or 0.39% to 23,176.05.

Foreign investors’ strong buying interest in the Indian debt market can be attributed to India’s inclusion in JP Morgan’s Emerging Market government bond indices in June this year. Image used for representative purpose only.
| Photo Credit: Reuters

Foreign investors infused ₹11,366 crore in the Indian debt market so far this month, pushing the net inflow tally in the debt segment to over the ₹1-lakh-crore mark.

Foreign investors’ strong buying interest in the Indian debt market can be attributed to India’s inclusion in JP Morgan’s Emerging Market government bond indices in June this year.

According to data with the depositories, Foreign Portfolio Investors (FPIs) injected ₹11,366 crore in the debt market this month (till August 24).

This inflow came following a net investment of ₹22,363 crore into the Indian debt market in July, ₹14,955 crore in June and ₹8,760 crore in May.

Before that, they pulled out ₹10,949 crore in April.

With the latest flow, FPIs net investment in debt has reached ₹1.02 lakh crore in 2024 so far.

Market analysts said that ever since the announcement of India’s inclusion came in October 2023 year, FPIs have been front-loading their investments in Indian debt markets in anticipation of the inclusion in global bond indices.

Even after the inclusion, their inflows have continued to remain robust.

On the other hand, FPIs pulled out over ₹16,305 crore from equities so far this month, due to unwinding of the yen carry trade, recession fears in the US and ongoing geopolitical conflicts.

Himanshu Srivastava, Associate Director, Manager Research, Morningstar Investment Research India, said the post-budget announcement of an increase in capital gains tax on equity investments has largely fueled this selling spree.

In addition, FPIs have been cautious due to the high valuations of Indian stocks, coupled with global economic concerns such as rising recession fears in the U.S. amid weak jobs data, uncertainty over the timing of interest rate cuts, and the unwinding of yen carry trade, he added.

Overall, India remains in a favourable position, attracting long-term investments from FPIs.

“Amidst a global slowdown, geo-political crisis in the middle east and neighbouring countries, India still stands at a sweet spot compelling the foreign fraternity to take a bet for a long term investment horizon,” Manoj Purohit, Partner & Leader, Financial Services Tax, Tax & Regulatory Services, BDO India, said.

In terms of sectors, FPIs were big sellers in financials in India in the first fortnight of August.

Vipul Bhowar, Director Listed Investments, Waterfield Advisors, said that FPIs are selling banking shares due to concerns over slow deposit growth.

“There are also challenges in Q1FY25 for banks with shrinking margins, deteriorating asset quality, and rising provisions, especially in credit cards, personal loans, and agriculture portfolios,” he said.

Besides, selling was witnessed in many other sectors including metals on fears that economic slowdown in US and China will keep metal prices soft, V.K. Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said.

Conversely, foreign investors were buyers in telecom and health care where the growth and earnings prospects are safe and bright, he added.