Domestic equity markets ended the first phase of the special trading session on a flat note on Saturday. The BSE's barometer Sensex added merely 42.60 points, or 0.06 per cent to 73,959.63-mark. NSE's Nifty50 inched 15.80 points, or 0.07 per cent, up to 22,481.90. Broader markets continued to outperform as the BSE midcap index rose about half a per cent per cent, while the BSE Smallcap index gained 0.8 per cent in the early session.
Exchanges are conducting a special trading activity with specific timings on May 18 in the equity and equity derivatives segments to evaluate their disaster preparedness in case of any major disruption.
The Dow Jones Industrial Average has hit 40,000 for the first time, buoyed by optimism from a softer-than-expected April inflation report, which has increased bets on a September rate cut by the Federal Reserve. This positive sentiment extends to Indian markets, Prashanth Tapse, Senior VP (Research), Mehta Equities.
On a stock specific basis, Balkrishna Industries, Bharat Dynamics, Kaynes Technologies, Zydus Lifesciences, Shakti Pumps, Varroc Engineering, Universal Cables, Centrum Captial, GMR Power and Urban Infra and Sudarshan Chemical & Industries hit an upper circuit of 5 per cent.
On the downside, Waaree Renewable Technologies and Vindhya Telelinks tumbled 5 per cent each. Tasty Bite Eatables and Astral were down 4 per cent each, while Indo Rama Synthetics India and Tourism Finance Corporation of India declined 3 per cent each in the opening tick.
Dow Jones closing in record territory above 40000 will continue to provide global support for equity markets. However, in India, the election related jitters might continue to cause high volatility. A significant trend now is the FIIs turning buyers yesterday, and this takes away the pressure on the markets, said VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
"The unknown in the market now, and there are many views regarding this, is the impact of the low turnout in the first three phases of polling on the election results. If this impacts the BJP/NDA adversely and they fall short of the market expectations, there can be high selling dragging the market down," he said, picking largecaps in financials, autos, capital goods, telecom and realty space.
The special session would be divided into two parts — the first session would begin at 9:15 am and run till 10 am. Trading in this session would be done from the primary site. In the second session from the disaster recovery site, trading would be held between 11:45 am and 1 pm. Pre-opening session will continue for an initial 15 mins.