By Vivek Kumar M and Bharath Rajeswaran
(Reuters) -India’s benchmark indexes slipped in early trade on Tuesday as investors booked profits after a post-ceasefire rally powered the market to its best session in over four years, with April inflation data now on the radar.
The Nifty 50 was down 0.94% at 24,691.60 and the BSE Sensex lost 1.08% to 81,555.06 as of 10:28 a.m. IST.
Nine of the 13 major sectors logged losses. The broader small-caps and mid-caps traded 0.6% and 0.3% higher, respectively.
Defence and shipbuilding stocks led gains in the broader market on expectations of stronger order flows following the India-Pakistan conflict.
Analysts expect the benchmarks to consolidate after Monday’s nearly 4% relief rally, sparked by a ceasefire and easing cross-border tensions.
“It appears that (the) Indian market has shed its fears regarding the India-Pakistan conflict, but a China-U.S. trade deal may reduce the relative attractiveness of India,” analysts led by Vikash Kumar Jain of CLSA said on Tuesday.
U.S. and China on Monday reached a deal to temporarily slash harsh reciprocal tariffs and cooperate to avoid rupturing the global economy.
“Rising fears of global trade disruptions since March made India the place to hide for foreign investors. However the receding fears may drive a shift in FIIs towards China,” CLSA analysts said.
India saw bouts of foreign inflows in March, which strengthened in April and May, after aggressive sell-off since late-September when the market hit record high levels.
Investors are also waiting for India’s April inflation data, due after market hours later in the day.
Pharmaceutical stocks bucked the market trend on Tuesday and jumped 1.7% as the U.S. President Donald Trump’s executive order directing drugmakers to lower prices was not as bad as feared.
(Reporting by Vivek Kumar M and Bharath Rajeswaran; Editing by Nivedita Bhattacharjee and Sonia Cheema)
