Indian equity markets recouped their early losses to end in green on Thursday, following buying in IT, TECK and Industrials stocks amid a higher opening in European markets. Headline indices made a cautious start, as traders got anxious with exchange data showing that Foreign Institutional Investors (FIIs) were net sellers in capital markets as they offloaded shares worth Rs 736.82 crore on Wednesday. But, markets soon recovered from initial fall and traded flat, as traders took some support with B B Swain, Secretary to the Union Ministry for Micro, Small and Medium Enterprises (MSMEs) stating that the government has acknowledged MSMEs' contribution to the country's economic growth, and the Budget 2023-24 has given a boost to the fund-starved sector with higher credit flow and by simplifying compliances. However, markets witnessed some selling in afternoon deals, as traders turned cautious with private report stating that the Reserve Bank of India is likely to raise interest rates once again in April as inflation pressures persist and the Federal Reserve continues to tighten, a day after the central bank delivered what many had expected to be its last hike in the current cycle. But, markets turned higher during the last hour of trade, as some optimism came among traders with Union Minister of State for Commerce and Industry Som Prakash's statement that the industrial growth during 2021-22 was 11.7% over the corresponding period of the last year. He also highlighted that the government has undertaken various steps to boost industrial performance. Finally, the BSE Sensex rose 142.43 points or 0.23% to 60,806.22 and the CNX Nifty was up by 21.75 points or 0.12% to 17,893.45.

The US markets ended lower on Thursday on ongoing interest rate concerns following hawkish comments by some Federal Reserve officials.  Private report stated that some traders were placing bets the Fed will have to do a lot more tightening than what Wall Street is pricing in. Some cautiousness prevailed in the markets as a report released by the Labor Department showed first-time claims for U.S. unemployment benefits rebounded by slightly more than expected in the week ended February 4th. The Labor Department said initial jobless claims rose to 196,000, an increase of 13,000 from the previous week's unrevised level of 183,000. Street had expected jobless claims to inch up to 190,000. The uptick came after jobless claims decreased in four out of the five previous weeks, falling to their lowest level since hitting 181,000 in the week ended April 23, 2022. On the sectoral front, Airline stocks moved sharply lower over the course of the session, resulting in a 3.6 percent nosedive by the NYSE Arca Airline. With the steep drop on the day, the index hit its lowest closing level in almost a month. Substantial weakness also emerged among oil service stocks, as reflected by the 3.1 percent plunge by the Philadelphia Oil Service Index. The sell-off by oil service stocks came amid a decrease by the price of crude oil, with crude for March delivery falling $0.41 to $78.06 a barrel. Steel, banking and chemical stocks also showed significant moves to the downside, moving lower along with most of the other major sectors.

Crude oil futures ended lower on Thursday as prospects of more interest rate hikes by the Federal Reserve weighed on oil prices. However, expectations of higher oil demand from China helped limit oil's downside. Rating agency Fitch has revised its forecast for China's economic growth in 2023 to 5% from 4.1% previously, saying that broader economic activity is recovering faster than initially anticipated after lifting of COVID-19 restrictions. Benchmark crude oil futures for March delivery fell $0.41 or 0.5 percent at $78.06 a barrel on the New York Mercantile Exchange. Brent crude for April delivery dropped $0.90 or 1.06 percent at $84.19 (Provisional) a barrel on London's Intercontinental Exchange.

Rupee settled on a flat note against dollar on Thursday. Traders were concerned about outlook for interest rates and a global economic slowdown. Investors awaited more economic data for guidance on future rate hikes. Meanwhile, private report stated that the Reserve Bank of India is likely to raise interest rates once again in April as inflation pressures persist and the Federal Reserve continues to tighten, a day after the central bank delivered what many had expected to be its last hike in the current cycle. On the global front, sterling rose on Thursday, thanks to a pickup in investor risk appetite that knocked the dollar and to hawkish comments from Bank of England officials, even after evidence of further deterioration in the British housing market. Finally, the rupee ended on a flat note from its previous close of 82.54 on Wednesday.

The FIIs as per Thursday's data were net sellers in both equity and debt segment. In equity segment, the gross buying was of Rs 7702.32 crore against gross selling of Rs 8158.70 crore, while in the debt segment, the gross purchase was of Rs 682.87 crore against gross selling of Rs 1930.11 crore. Besides, in the hybrid segment, the gross buying was of Rs 17.65 crore against gross selling of Rs 18.43 crore.

The US markets ended lower on Thursday as Treasury yields rose after an auction of 30-year bonds went poorly and overshadowed strong earnings from corporate giants like Disney and PepsiCo. Asian markets are trading mostly in red on Friday ahead of China's inflation data. Indian markets rose for a second straight session on Thursday, though overall gains remained limited as Adani Group stocks began trading lower again after a two-day recovery. Today, markets are likely to get negative start tracking weakness in global markets. Investors will be looking forward to the index of industrial production (IIP) or industrial growth data to be out later in the day. Continued foreign fund outflow likely to dent sentiments in the markets, as foreign institutional investors (FII) sold shares worth Rs 144.73 crore on February 9, as per provisional data available on the NSE. Traders will be concerned with a private report that the inflation rate, measured by the annual change in the consumer price index (CPI), is forecast to have risen to 5.9% in January from 5.72% in December. There will be some reaction in auto stocks with report that the Delhi Transport Department has so far de-registered 54,42,267 vehicles, as on January 31, including 10-year-old diesel vehicles and 15-year-old petrol/CNG vehicles. Sugar industry stocks will be in focus as trade body AISTA said India has exported 27.83 lakh tonnes of sugar till February 9 of the ongoing 2022-23 marketing year, with Bangladesh and Indonesia being the top markets. There will be some buzz in the tourism industry stocks as Union Minister for Culture and Tourism G Kishan Reddy said the footfall of foreign tourists in India has reached 75 per cent level of what it was in 2019 before the COVID-19 pandemic broke out. Traders will be eyeing the earnings from many companies including Mahindra and Mahindra, ABB India, PB Fintech, Abbott India, Alkem Laboratories, Ashoka Buildcon, Astrazeneca Pharma, BEML, BHEL, Dilip Buildcon, Delhivery, EIH, Glenmark Pharmaceuticals, JK Lakshmi Cement, KFin Technologies, Lemon Tree Hotels, Metropolis Healthcare, NALCO, Info Edge India, and Oil India for more cues. Also, Adani Group stocks would be in focus after index provider MSCI cut the free-float designations of four securities of the group and Norway's sovereign wealth fund said it has sold its remaining stake in the group companies. Meanwhile, Agrawal Float Glass India (NSE SME) IPO opens on February 10 and will be available for subscription till February 15.

Support and Resistance: NSE (Nifty) and BSE (Sensex)

Nifty Top volumes

• Tech Mahindra has signed a MoU with the Ministry of Communication and Information Technology, Saudi Arabia to establish a Data & AI and a Cloud CoE in Riyadh. 
• The UK government has offered a counter-package to Tata Steel against its proposal seeking a financial package to execute its decarbonisation plans for its plant in Port Talbot.
• Jio-bp, a fuels and mobility joint venture between Reliance Industries and bp, has rolled out E20 petrol. 
• Hindalco Industries has reported fall of 62.94% in its consolidated net profit at Rs 1362 crore for Q3FY23 as compared to Rs 3675 crore for the same quarter in the previous year.