First Tick: Key Global Cues to Watch for Today’s Trade – May 12

As markets gear up for today's trading session, several key global and domestic cues are expected to drive investor sentiment. After a volatile week marked by geopolitical tensions and shifting fund flows, here’s a comprehensive look at what’s shaping market movements on May 12.

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📉 FII-DII Fund Flow Dynamics

After a 16-day buying streak, Foreign Institutional Investors (FIIs) turned net sellers on May 9, pulling out ₹3,798 crore from Indian equities. This marks a cautious turn amid growing geopolitical concerns and global uncertainty.

In contrast, Domestic Institutional Investors (DIIs) remained bullish, pumping in ₹7,277 crore on the same day, reflecting confidence in long-term domestic fundamentals despite short-term volatility.

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📊 Indian Market Outlook: Gap-Up Opening Expected

Following a sharp sell-off in the previous session, Indian benchmark indices are likely to open on a positive note today. The GIFT Nifty, trading around 24,559 in early morning deals, points to a gap-up opening for both Sensex and Nifty 50.

This bounce comes after both indices suffered heavy losses on May 9 due to geopolitical tensions between India and Pakistan, overshadowing positive global cues. The Sensex closed 880 points lower at 79,454.47, while the Nifty fell by 265.80 points to end at 24,008.

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🌐 Global Markets Snapshot

🔁 US Equities – Mixed Close

US stocks closed the week on a cautious note.

• Dow Jones fell by 119 points (0.29%)

• S&P 500 slipped 0.07%

• Nasdaq ended flat

Investors were weighing President Trump's comments on Chinese tariffs ahead of trade negotiations, keeping the mood subdued.

📈 US Bond Yields – Up

Yields on both the 10-year and 2-year US Treasury notes rose by 3 basis points, reflecting increased risk appetite amid positive trade developments.

💵 Dollar Index – Climbs

The US Dollar Index rose in early Asian trading hours as diplomatic discussions between the US and China over the weekend signaled easing trade tensions.

💱 Asian Currencies – Mixed Bag

Asian currencies presented a mixed picture:

• Weaker: Japanese Yen, Indonesian Rupiah, Thai Baht, Malaysian Ringgit, Taiwan Dollar, Singapore Dollar

• Stronger: South Korean Won, Philippines Peso, China Renminbi

🛢️ Crude Oil – Rises

Oil prices ticked higher, boosted by optimism in US-China trade talks. A resolution could potentially lead to higher global crude demand.

🪙 Gold – Slips

Gold prices declined as investor appetite for risk increased and tensions in global hot spots showed signs of cooling. The yellow metal’s safe-haven appeal weakened in the wake of diplomatic progress.

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🔍 Key Takeaways for Traders

• Watch for volatility around India-Pakistan developments despite global positivity.

• Domestic cues remain strong with DIIs showing buying strength.

• Global risk sentiment is improving, thanks to US-China trade progress.

• Energy and financial sectors may benefit from rising crude and bond yields.

• Stay cautious on gold-related stocks or ETFs, as the metal sees short-term pressure.

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📈 Bottom Line

While the domestic market took a hit from geopolitical risks last week, today’s trade opens on a cautiously optimistic note. With strong DII support and positive signals from GIFT Nifty and global markets, investors may look for selective opportunities, particularly in sectors aligned with global recovery and domestic demand.

Wishing all traders a profitable and informed trading day!