Indian Stocks’ April Rally Masks Fragile Underpinnings

Good morning...

I’m Savio Shetty in Mumbai, with a quick pulse check ahead of Thursday’s open.

An April rally has put Indian stocks on track for their first monthly advance since November. Yet the rebound is failing to inspire confidence. The benchmark Nifty’s 8.3% gain so far this month pales in comparison to an advance of more than 13% in the broader MSCI Asia Pacific Index. Global funds remain sellers of local shares, having pulling a net $4.2 billion so far in April, while rising oil prices threaten to dent demand in the energy-reliant economy and keep pressure on the rupee.

For Thursday’s session, global cues don’t look supportive — Asian equities are down and oil is up. President Donald Trump told Axios he will not lift a naval blockade of Iran’s ports until he secures a nuclear agreement with Tehran.

Locally, earnings from consumer giant Hindustan Unilever and Adani Enterprises are in focus. Traders will also keep an eye on political developments: Prime Minister Narendra Modi has a slight edge over his main rival in the key state of West Bengal, exit polls from the election show, giving his party the chance to govern the region for the first time ever.

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