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Bombay Stock Exchange

• The Indian stock market began flat, with mixed trends across sectors and indices.
• Foreign institutional investors (FIIs) sold equities worth Rs 5,684 crore, impacting the market.
• Sectoral performance varied, with buying in auto, IT, PSU bank, financial services, and pharma sectors.
• Investors are advised to adopt a cautious approach due to sustained FII outflows and elevated valuations.

The Indian stock market commenced on a flat note on Thursday, October 24, 2024. Early trade saw buying in sectors such as auto, IT, PSU bank, financial services, and pharma. The Sensex was trading at 80,194.93, marking a rise of 112.95 points or 0.14 per cent, while the Nifty was trading at 24,465.30, up by 29.80 points or 0.12 per cent.

However, the market trend remained mixed, with 679 stocks trading in green and 854 stocks trading in red on the National Stock Exchange (NSE).

The Nifty Bank was at 51,456.95, up by 217.95 points or 0.43 per cent. The Nifty Midcap 100 index was trading at 56,454.40, slipping 79.15 points or 0.14 per cent.

Meanwhile, the Nifty Smallcap 100 index was at 18,317.95, up by 31.75 points or 0.17 per cent. HDFC Bank, Sun Pharma, HCL Tech, Tata Motors, BEL, and Adani Ports emerged as the top gainers in the Sensex pack, while Hindalco, Hindustan Unilever Limited, SBI Life, and Nestle India were the top losers.

FII Outflows and Global Factors

Foreign institutional investors (FIIs) sold equities worth Rs 5,684 crore on October 23, while domestic institutional investors bought equities worth Rs 6,039 crore on the same day. According to market experts, the major headwind that the market is facing now is the massive and sustained FII selling which has touched Rs 93,088 crore through October 23, as per the NSDL data.

"The fundamental trigger for the FII outflows is the elevated valuations in India and the relatively cheap and attractive valuations in markets like China and Hong Kong," said market watchers.

The performance of the Indian market is also influenced by global factors. The US stock markets closed in the red on the previous trading day, which could have a negative impact on investor sentiment in India. Additionally, the market is also looking forward to the outcome of the US presidential elections, which could have potential impacts on the global and Indian markets.

Sectoral Performance and Market Strategy

In terms of sectoral performance, buying was observed in auto, IT, PSU bank, financial services, and pharma sectors during early trade. HDFC Bank, Sun Pharma, HCL Tech, Tata Motors, BEL, and Adani Ports were among the top gainers in the Sensex pack. On the other hand, Hindalco, Hindustan Unilever Limited, SBI Life, and Nestle India were among the top losers.

The Nifty Bank, Nifty Midcap 100 index, and Nifty Smallcap 100 index also showed mixed performance. The Nifty Bank rose by 217.95 points or 0.43 per cent, while the Nifty Midcap 100 index slipped by 79.15 points or 0.14 per cent. The Nifty Smallcap 100 index, on the other hand, rose by 31.75 points or 0.17 per cent.

Market experts have advised investors to adopt a cautious strategy given the sustained FII outflows and elevated market valuations. They recommended a sell on rise approach, indicating that investors should consider selling stocks when they appreciate, especially if the Nifty remains below 25,000, with a focus on the 24,650 to 24,850 range as a selling zone. This reflects a defensive stance in anticipation of further market corrections.