Bitcoin (BTC) and Ethereum (ETH) Lead Market Amid Q4 Results, Lok Sabha Elections, and Global Economic Cues

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    <li>Indian stock markets broke out of their sideways consolidation and have caught a broader bull run led by strong macroeconomic fundamentals and foreign fund inflows ahead of the high-stakes Lok Sabha election results due on June 4, 2024.</li>
    <li>Domestic equity benchmark indices recorded their biggest two-week winning streak in the last five months amid the election rally gripping the pulse on D-Street.</li>
    <li>“Markets are continuously making steady gains, with Nifty achieving a historic mark of 23,000 zones just after a few days of BSE-listed companies' market cap crossing $5 trillion,” said Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd.</li>
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<p><strong>Indian stock markets are on a bullish run ahead of the Lok Sabha elections, driven by strong macroeconomic fundamentals and foreign fund inflows.</strong></p>

<h2><strong>Q4 Results, Lok Sabha Election Updates</strong></h2>
<p>On the domestic front, markets have reached the final curtain for the Q4 earnings season. Many companies, including some big names such as Tata Steel, PTC India, Reliance Capital, Apollo Hospitals, among others, will release their financial results next week.</p>
<p>The markets are seeing a significant boost from the Indian economy, political stability, and expectations of a BJP-led alliance winning a third term, ensuring economic growth, according to analysts. The positive earnings reports from the fourth quarter could provide strength for the market to continue its bullish momentum.</p>

<h3><strong>5 New IPOs, 2 Listings to Hit D-Street</strong></h3>
<p>In the mainboard segment, no new issues are listed so far, to open for subscription in the coming week. Out of the ongoing issues, Awfis Space Solutions IPO will close for bidding on May 27.</p>
<p>In the SME segment, Vilas Transcore IPO will open for subscription on May 27, Beacon Trusteeship IPO will open on May 28, and Ztech India IPO will open on May 29. Aimtron Electronics IPO will open for bidding on May 30 and TBI Corn IPO will open on May 31. Among the ongoing issues, GSM Foils IPO will close on May 28.</p>
<p>Among listings, shares of Awfis Space Solutions will debut on BSE, NSE on May 30. Additionally, shares of GSM Foils will get listed on NSE SME on May 31.</p>

<h3><strong>FII Activity</strong></h3>
<p>Foreign institutional investors (FIIs) significantly lowered their selling streak amid robust domestic market sentiments. Though they were sellers for three out of four sessions last week, yet a net inflow was recorded at ₹1,165.54 crore. Domestic institutional investors (DIIs) were net buyers for all sessions, with a total investment of ₹6,977.71 crore, according to stock exchange data.</p>
<p>The massive short-covering caused by this sudden change in FII trade contributed to a sharp rally in markets. The change in FII stance has been caused by the underperformance of the Hang Seng index which is down 4.1 per cent during the last five days.</p>
<p>‘’The outperformance of the Hang Seng had led to “sell India, buy China'' trade during the last one month. It appears that this trade is over and that’s why FIIs have again turned buyers in India.</p>
<p>What makes this rally healthy is the fact that it is being led by fairly valued largecaps with the overvalued broader market taking a backseat. The trend of outperformance of largecaps is likely to continue,'' said Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.</p>
<p>Foreign investors have largely been on a selling spree in Indian markets this year, but, sentiments may shift after June 4. ‘’We are very close to the Lok Sabha election results, and the election verdict will give a boost to FII flows,'' said Pravesh Gour, Senior Technical Analyst at Swastika Investmart Ltd.</p>
<p>Foreign portfolio investors (FPIs) remained assertive sellers but also toned down their bearish sentiments last week. They offloaded ₹22,046 crore worth of Indian equities and the total outflow stands at ₹17,848 crore as of May 24, taking into account debt, hybrid, debt-VRR, and equities. The total debt inflows stand at ₹2,009 crore so far this month.</p>
<p>"The long-term outlook for FPI flows into Indian debt is positive due to India's inclusion in global bond indices. However, near-term flows are being impacted by global macroeconomic uncertainty and volatility. The trend will reverse once the interest rate outlook becomes clearer,'' said Vipul Bhowar, Director, Listed Investments, Waterfield Advisors.</p>
<p>‘’The RBI's dividend payout is a positive development for the fiscal situation. However, its impact on FPI interest in the debt market is uncertain and will depend on how the government utilises the dividend. Considering the overall economic conditions, clarity on this matter will emerge in the full budget in July 2024, providing a clearer picture for FPI investors,'' added Bhowar.</p>

<h3><strong>Conclusion</strong></h3>
<p>Overall, analysts expect Nifty 50 to move toward the 23,150-23,400 range soon. They added that a gradual up-move is expected, however, markets may still witness some volatility this week due to the scheduled expiry of May month derivatives contracts. Experts advise traders to continue the stock-specific trading approach, with a preference for large-cap and large mid-cap stocks for short-term trades.</p>