Markets decline in early trade amid foreign fund outflows and weak earnings

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The benchmark Sensex and Nifty indices fell in early trade on Monday, according to PTI, as persistent foreign fund outflows, disappointing quarterly earnings, and weak trends in Asian markets weighed heavily on investor sentiment.

As per PTI, forex traders indicated that market volatility is likely to persist as the short-term trend remains uncertain, with consolidation expected to continue in the near term under a weak bias. In early trade, the BSE benchmark Sensex dropped by 484.98 points, standing at 79,001.34, while the NSE Nifty lost 143.6 points, reaching 24,004.60.

According to PTI, from the 30-share Sensex pack, Asian Paints witnessed a sharp fall of over 8 per cent after the company reported a 43.71 per cent decline in consolidated net profit to Rs 693.66 crore for the September quarter. The decline was attributed to weak demand conditions, inflation in material prices, and a fall in the decorative and coatings business in the domestic market. Other stocks that were among the laggards included Axis Bank, Adani Ports, Nestle, Reliance Industries, Tata Steel, and IndusInd Bank.

However, as per PTI, some stocks bucked the trend and were in the green. Tata Motors, Power Grid, Maruti, and HCL Technologies were among the gainers in early trade.

Foreign Institutional Investors (FIIs) continued their selling spree, offloading equities worth Rs 3,404.04 crore on Friday, according to exchange data. Prashanth Tapse, Senior VP (Research) at Mehta Equities Ltd, said, "Indian markets remain under pressure, largely due to relentless foreign investor selling," as per PTI.

In line with the weak sentiment in Indian markets, PTI reported that Asian markets were also quoting lower, with Seoul, Tokyo, Shanghai, and Hong Kong all experiencing declines. In contrast, Wall Street had ended on a positive note on Friday.

As per PTI, V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, noted that the sustained rally in US markets, which saw the Dow and S&P 500 surpass 40,000 and 6,000 respectively, is no longer providing momentum for Indian markets. He added, "In India, worse-than-expected earnings downgrades for FY25 are weighing on stock prices, favouring the bears in the near term."

Meanwhile, PTI also reported that the global oil benchmark, Brent crude, dipped by 0.42 per cent to USD 73.56 a barrel.

On Friday, as per PTI, the Sensex had ended 55.47 points or 0.07 per cent lower at 79,486.32, and the Nifty had dropped by 51.15 points, or 0.21 per cent, to 24,148.20.

(With inputs from PTI)