Indian equity benchmarks continued their winning streak for the sixth straight session on Friday, despite a cautious global market atmosphere. Markets made a gap up opening and traded with a positive bias throughout the day, as traders took encouragement with a private report that Inflation in India was likely to have eased in August from a 15-month high in July, led by cooling vegetable prices. Erratic monsoon rains have ruined some crops of staple food items, prompting the government to subsidise vegetable prices and ban exports of some cereals, providing temporary relief to households. Some support also came in as NaBFID Chairman KV Kamath said India's GDP will likely grow to $25 trillion size in the next 25 years and digital fintech players could contribute to about 25%-30% of the overall growth. However, key gauges trimmed some gains in morning deals, as traders got anxious with a private report stating that the all-India cumulative rainfall stood at -11 per cent of long period average (LPA) on September 5, well below the normal (+/- 4 per cent of LPA), and worse than -9 per cent of LPA a week back. But, markets regained traction in second half of trading session, as traders found solace after a G20 document prepared by the World Bank stated that India has achieved financial inclusion targets in just 6 years which would otherwise have taken at least 47 long years. The document highlights the groundbreaking measures taken by Central Government and the pivotal role of government policy and regulation in shaping the Digital Public Infrastructure (DPI) landscape. Traders also took a note of a private report stating that India needs to grow at 8-9 per cent for the next 20 years to become a developed nation by 2047 as envisioned by Prime Minister Narendra Modi. Meanwhile, a report stated that India and the 10-nation bloc Asean are expected to formally launch the review exercise for the free trade agreement (FTA) in November. They have agreed to fast-track negotiations for the review of the existing agreement in goods between the two regions and conclude the talks in 2025. Finally, the BSE Sensex rose 333.35 points or 0.50% to 66,598.91 and the CNX Nifty was up by 92.90 points or 0.47% to 19,819.95.

The US markets ended higher on Friday as some traders picked up stocks at reduced levels following recent weakness. Meanwhile, some traders have felt concerns about the outlook for interest rates, which contributed to the recent weakness, have been overdone. While recent economic data has led to worries the Federal Reserve may leave rates higher for longer than previously anticipated, the central bank is still widely expected to keep rates unchanged later this month. On the economic data front, a report released by the Commerce Department showed a modest decrease by U.S. wholesale inventories in the month of July. The Commerce Department said wholesale inventories dipped by 0.2 percent in July after falling by a revised 0.7 percent in June. Street had expected wholesale inventories to edge down by 0.1 percent compared to the 0.5 percent decrease originally reported for the previous month. The modest decline in wholesale inventories came as a 0.3 percent drop by inventories of durable goods more than offset a 0.1 percent uptick in inventories of non-durable goods. On the sectoral front, oil stocks showed a significant move to the upside on the day, benefitting a rebound by the price of crude oil following the pullback seen on Thursday. With crude for October delivery climbing $0.64 to $87.51 a barrel, the NYSE Arca Oil Index advanced by 1.4 percent to a record closing high. Notable strength was also visible among banking stocks, as reflected by the 1.1 percent gain posted by the KBW Bank Index. Brokerage, utilities and software stocks also saw some strength on the day, while telecom stocks came under pressure over the course of the session.

Crude oil futures ended higher on Friday on concerns about tightening oil supplies following Russia and Saudi Arabia's decision earlier this week to extend their supply cut till the end of the year. Russia extended its voluntary decision to reduce its oil exports by 300,000 bpd to the end of this year, raising speculation that prices will remain elevated through 2023. However, gains remained capped amid worries about the outlook for oil demand from China where the economy still remains fragile. Benchmark crude oil futures for October delivery rose $0.64 or 0.7 percent to settle at $87.51 a barrel on the New York Mercantile Exchange. Brent crude for November delivery gained $0.52 or 0.58 percent to settle at $90.44 a barrel on London's Intercontinental Exchange.

Indian rupee ended higher on Friday helped by a firm trend in domestic equities. Besides, the local unit appreciated after the Reserve Bank announced the discontinuation of incremental cash reserve ratio in a phased manner by October 7, 2023. Some optimism also came in as NaBFID Chairman KV Kamath said India's GDP will likely grow to $25 trillion size in the next 25 years and digital fintech players could contribute to about 25%-30% of the overall growth. On the global front, dollar fell on Friday but was still headed for its longest weekly winning streak in nine years, bolstered by a resilient run of U.S. economic data that has also put the end of the Federal Reserve's aggressive rate-increase cycle into question. Finally, the rupee ended at 83.02 (Provisional), stronger by 21 paise from its previous close of 83.23 on Thursday.

The FIIs as per Friday's data were net sellers in equity segment, while they were net buyers in debt segment. In equity segment, the gross buying was of Rs 9025.02 crore against gross selling of Rs 9744.17 crore, while in the debt segment, the gross purchase was of Rs 1026.57 crore with gross sales of Rs 618.84 crore. Besides, in the hybrid segment, the gross buying was of Rs 16.74 crore against gross selling of Rs 17.56 crore.

The US markets ended higher on Friday with marginal gains amid uncertainty over the inflationary outlook. Asian markets are trading mostly in red on Monday ahead of economic data from major economies. Indian markets extended their winning run to a sixth consecutive session on Friday despite weak cues from global markets. Today, start of new week is likely to be on optimistic note ahead of key macro data due in India and overseas. Traders will be taking encouragement as Finance Minister Nirmala Sitharaman said India's external debt of $624.7 billion at March-end 2023 with a debt-service ratio of 5.3 per cent is within the comfort zone and modest from a cross-country perspective. Sitharaman said the ratio of external debt to GDP declined to 18.9 per cent at March-end 2022-23 from 20 per cent a year ago. Some support will also come as the Reserve Bank said India's forex reserves jumped by $4.039 billion to $598.897 billion for the week ended September 1. In the previous reporting week, the overall reserves had dropped by $30 million to $594.858 billion. Besides, India and Brazil have agreed to work together for the expansion of India-Mercosur preferential trade agreement (PTA) to further promote economic ties. Mercosur is a trading bloc in Latin America, comprising Brazil, Argentina, Uruguay and Paraguay. Meanwhile, the Reserve Bank of India (RBI) will introduce the wholesale version of its central bank digital currency (CBDC), the digital rupee-wholesale, in the call money market by October. However, foreign fund outflows likely to dent sentiments. Provisional data from the National Stock Exchange (NSE) showed foreign institutional investors (FII) sold shares worth Rs 224.22 crore on September 8. Stock ethanol producing companies likely to be in focus after the launch of the Global Biofuel Alliance at the G-20 summit. Railway related stocks will also be on radar on other announcements such as the India-West Asia-Europe rail corridor. There will be some buzz in the primary market this week with six companies geared up to raise more than Rs 4,000 crore from public, and five listings queued up for debut.

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

Nifty Top volumes

• JSW Steel has reported the crude steel production at 22.86 lakh tonnes for August 2023, that grew by 19% as against 19.22 lakh tonnes in August 2022 on consolidated basis. 
• Bajaj Finance has forged a dynamic partnership with Flipkart, India's leading e-commerce platform. 
• ICICI Bank has set up a branch at Baner in Pune, the 100th branch of the Bank in the city.
• LTIMindtree has launched two industry solutions, AdSpark and Smart Service Operations, to accelerate the time-to-market for businesses on the Salesforce platform.