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Indian markets extended their losses for third straight session on Thursday weighed down by profit-taking as Q4 earnings fail to lift Dalal Street amid fears of a US debt default. Today, the markets are likely to get flat-to-positive start tracking gains in global peers. Foreign fund inflows likely to aid domestic sentiments. Foreign institutional investors (FIIs) remained net buyers and bought shares worth Rs 970.18 crore on May 18, according to provisional data from the National Stock Exchange. Some support will also come as S&P Global Ratings affirmed India's sovereign rating at 'BBB-' for the long term and ‘A-3’ for the short term, with a stable outlook, as sound economic fundamentals were expected to underpin growth over the next two to three years. Traders may take note of report that India and Britain are struggling to make progress in free trade talks due to differences on some key tariff lines and investment protection rules, making a deal unlikely during Prime Minister Narendra Modi's second term ending next year. Meanwhile, The Securities Exchange Board of India (Sebi) has proposed to make the total expense ratio (TER) charged by mutual funds (MFs), inclusive of the Goods and Services Tax (GST) charged on management fee and has shared revised expense slabs for MFs to account for the tax outgo. Oil & gas sector stocks will be in focus as oil marketing companies (OMCs) did not change the fuel prices on May 18 the petrol and diesel rates continue to remain the same at the prevailing prices in major metros across India. Shares of NTPC, Power Grid, Punjab National Bank, JSW Steel, Zomato, Glenmark Pharma and Delhivery, among others, will be on the radar ahead of their Q4 result. Moreover, Nexus Select Trust REIT is likely to make debut on stock exchange on May 19.

The US markets ended higher on Thursday with Walmart's strong earnings and optimism that lawmakers will eventually reach an agreement on raising the U.S. debt ceiling helping underpin sentiment. Asian markets are trading mostly higher on Friday though Chinese and Hong Kong markets fell sharply on concerns that China's economic recovery is losing steam.

Back home, Indian equity benchmarks failed to hold their intraday gains and closed lower for the third consecutive session on Thursday, pulled down by index majors ITC and State Bank of India after their fourth quarter earnings failed to cheer investors. Markets made an optimistic start as traders took support with a private report that the country's current account deficit may narrow to 1.4 per cent of GDP or $50 billion in 2023 as compared to 2.4 per cent in the previous year as net remittances flows are expected to be $104 billion. Sentiments remained positive with Secretary in the Department for Promotion of Industry and Internal Trade (DPIIT) Rajesh Kumar Singh’s statement that the productionlinked incentive (PLI) scheme is showing significant dividends across many sectors. He said the benefits under the PLI scheme are yielding positive results and thus, the government is considering extending the benefits of the PLI scheme to some labourintensive sectors. However, in the late afternoon deals, markets erased all of their gains to end lower on the back of profit booking across sectors and in heavyweights. Traders also turned cautious with a private report that the value of foreign portfolio investment (FPI) in Indian equities was at $542 billion in the March quarter of 2023, a decline of 11 per cent from the preceding year, largely due to the exodus of foreign money from the domestic market. In comparison, the value of FPI in Indian equities was $612 billion in the JanuaryMarch quarter of 2022. Meanwhile, Commerce and Industry Minister Piyush Goyal has said that the Customs duties of India are ‘very’ often misconstrued to be high on most items, raw materials, intermediates but in reality, the duties are very low. He said that the duties on technological items that are helping the Indian economy grow are very low. Finally, the BSE Sensex fell 128.90 points or 0.21% to 61,431.74 and the CNX Nifty was down by 51.80 points or 0.28% to 18,129.95. 

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