Sensex and Nifty 50 trade higher on positive global cues; metals and autos lose steam

Broader markets outperform benchmark indices

The BSE Sensex and NSE Nifty 50 kicked off with gains on May 15, driven by robust global markets ahead of key U.S. inflation data expected later today, which could influence the Federal Reserve's next moves.

Early Gains and Outperformance in Broader Markets

By 9:21 am, the Sensex had climbed 83 points (0.1 percent) to 73,187, and the Nifty 50 had risen 35 points to 22,252. Broader markets shone even brighter, with both BSE Midcap and BSE Smallcap indices jumping over 1 percent. Twelve out of thirteen major sectoral indices were in the green. Nifty Auto was the only laggard, down 0.1 percent, while Nifty PSU Bank was the biggest gainer, rising nearly 2 percent.

Stocks on the Move

Drugmaker Cipla was trading 4.05 percent higher after three block deals involving 2.04 crore shares, making up a 2.52 percent stake, were reported. The blocks were sold by the promoters while the buyers could not be immediately ascertained. Coal India was the next big gainer on the Nifty, with gains of 3 percent. JSW Steel was the top loser on the Nifty, trading 1.62 percent lower on fears of Chinese dumping after the U.S. raised tariffs on steel, aluminum, semiconductors, and EVs. Eicher Motors and Bajaj Auto were also trading weak with losses of more than 1 percent.

Volatility Spikes as Dalal Street Awaits Election Results

Dalal Street is bracing for heightened volatility as the general election results loom. "Markets are naturally edgy ahead of major events like general election results, which can shape the economy for the next five years," explained Daljeet Singh Kohli, Head of Research & Strategy at Vasuki India Fund.

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Kohli predicted that volatility might ease as election phases progress and investors adjust their positions. Nirav Karkera, Head of Research at Fisdom, warned that the midcap and smallcap segments could experience even greater volatility.

DIIs Buy the Dips While FIIs Play it Cautious

Karkera noted significant selling by FIIs to sidestep election uncertainties. "Many are adopting a wait-and-watch approach, planning to re-enter post-election results," he said. Conversely, DIIs are capitalizing on the dip, snapping up shares sold by FIIs.

Kohli emphasized that the recent market correction hasn’t dented valuations significantly, which remain high by historical standards, reflecting confidence in India’s growth prospects. "If we consider anticipated growth and policy moves in the coming years, current valuations are justified," he added. Karkera urged traders to stay cool and not overreact to short-term market swings, as these are likely transient.

Key Market Events to Watch

Investors should keep an eye on general election updates, corporate earnings and their outlooks, and global developments. Mankind Pharma, Jindal Stainless, Dixon Technologies were trading weak while Power Finance Corp, Honeywell Automation, and LIC Housing Finance were trading strong ahead of results expected later in the day.

Technical Levels to Watch

Deven Mehta, Research Analyst at Choice Broking, highlighted key levels for the Nifty 50: support at 22,150, followed by 22,100 and 22,000. On the upside, immediate resistance is at 22,300, followed by 22,350 and 22,400.

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