Indian equity benchmarks buckled under selling pressure on Monday after nine-session rally, as massive sell-off in IT, tech and telecom counters unnerved investors. Markets started the week on a subdued note and remained under the bears' grip for whole day, as traders got anxious with data showing that investment in the Indian capital markets through participatory notes dropped to Rs 88,398 crore month-on-month in February amid higher valuation of domestic markets. This was the third consecutive monthly decline in the investment level. Some concern also came with report by credit rating agency Crisil stating that India Inc is likely to report a halving of revenue growth in the fourth quarter of FY23, as companies start reporting their financials. It said the revenue growth will come down to 10-12 per cent as against 22.8 per cent for the January-March period in the year-ago. Some pessimism also came as Moody's Investors Service said higher interest rates have increased repayment amounts and limited refinancing options for SME borrowers who have availed loans against property, heightening default risk for these loans. However, during the late afternoon session, the markets witnessed some recovery which helped them to come off their intraday lows, as traders found some solace with data indicating that India's inflation based on wholesale price index (WPI) declined further to 1.34% (Provisional) for the month of March 2023 as against 3.85% recorded in February 2023, due to fall in prices of non-food articles, mineral oils and electricity. Some support also came with Economic Advisory Council to the Prime Minister (EAC-PM) member Sanjeev Sanyal's statement that Indian economy will grow at around 6.5 per cent in the current fiscal and will continue to be the fastest-growing major economy in the world, notwithstanding a modest cut in growth projections by multilateral lending agencies. Sanyal further said that given the uncertainties in the global economy, India's performance is clearly far ahead of any other comparable economy. But, markets failed to erase all of their losses and settled in red as some pessimism remained among traders with commerce ministry in its latest data showing that India's merchandise exports fell 13.89 per cent to $38.38 billion in March 2023 as compared to $44.57 billion in March 2022. Imports too declined to $58.11 billion in the month under review from $63 billion a year ago. The trade deficit during March stood at $19.73 billion. Finally, the BSE Sensex fell 520.25 points or 0.86% to 59,910.75 and the CNX Nifty was down by 121.15 points or 0.68% to 17,706.85.

The US markets ended higher with gains over quarter percent on Monday as a report from the National Association of Home Builders said the NAHB/Wells Fargo Housing Market index in the US increased to 45 in April of 2023, rising for a fourth month in a row. This is a fresh high since September of 2022. Some support also came in on hopes that major banks and top ranking companies will come out with fairly encouraging earnings updates this week. Goldman Sachs, Bank of America, Morgan Stanley are scheduled to announce their quarterly earnings during the course of this week. Results are also due from Netflix, J&J and Tesla this week. However, markets were largely subdued for most part of the session amid concerns about economic slowdown and uncertainty about the outlook for interest rates. Meanwhile, the President and CEO of the Federal Reserve Bank of Richmond Thomas Barkin said that he wants to see more evidence of inflation settling back to target. Barkin also said that he feels reassured by what he is seeing in the banking sector. in the stock specific developments, Prometheus Biosciences soared 70 percent after Merck announced that it would acquire the biosciences company for approximately $10.8 billion. Shares of Charles Schwab Corporation surged about 4 percent after the company reported stronger than expected first-quarter earnings. However, Alphabet shares ended 2.6% down on reports Samsung is considering replacing Google with Microsoft's Bing as the default search engine on its devices.

Crude oil futures ended deeply in red on Monday as the U.S. dollar strengthened. The U.S. dollar has been strengthening alongside interest rate hikes, making dollar-denominated oil more expensive for holders of other currencies. The dollar index gained around 0.5% on Monday. Further, weakness also prevailed in oil prices on concerns about the outlook for energy demand due to a potential recession in the U.S. later this year. Meanwhile, a report from the Energy Information Administration showed U.S. shale crude production in the seven biggest shale basins in the country is expected to rise by 49,000 barrels per day in May to 9.33 million barrels per day. Benchmark crude oil futures for May delivery fell $1.69 or 2.1 percent to settle at $80.83 a barrel on the New York Mercantile Exchange. Brent crude for June delivery dropped $1.55 or 1.8 percent to settle at $84.76 a barrel on London's Intercontinental Exchange.     

Indian Rupee depreciated against the US dollar on Monday amid buying in the American currency by banks and importers. Investor sentiments remained fragile with the commerce ministry in its latest data showing that India's merchandise exports fell 13.89 per cent to $38.38 billion in March 2023 as compared to $44.57 billion in March 2022. Imports too declined to $58.11 billion in the month under review from $63 billion a year ago. The trade deficit during March stood at $19.73 billion. A negative trade in domestic equities along with strengthening of the American currency in the overseas market also weighed on the local unit. However, losses remained capped as some support came with data showing that India's inflation based on wholesale price index (WPI) declined further to 1.34% (Provisional) for the month of March 2023 as against 3.85% recorded in February 2023, due to fall in prices of non-food articles, mineral oils and electricity. On the global front, the dollar bounced from a one-year low on Monday as resilience in core U.S. retail sales, a rise in short-term inflation expectations and impressive Wall Street bank earnings raised market expectations for an interest rate hike in May. Finally, the rupee ended at 82.01 (Provisional), weaker by 16 paise from its previous close of 81.85 on Thursday.

The FIIs as per Monday's data were net buyers in both equity and debt segment. In equity segment, the gross buying was of Rs 8431.65 crore against gross selling of Rs 7627.30 crore, while in the debt segment, the gross purchase was of Rs 1480.26 crore against gross selling of Rs 717.18 crore. Besides, in the hybrid segment, the gross buying was of Rs 5.21 crore against gross selling of Rs 1.35 crore.

The US markets ended higher on Monday after the major averages rose to kick off a stacked week of corporate earnings. Asian markets are trading mixed on Tuesday as Wall Street's earnings season continues and investors await a slew of economic data out of China, most notably, its first quarter gross domestic product. Indian markets snapped nine-day winning streak on Monday following a rout in information technology (IT) stocks, with heavyweight Infosys sinking nearly 15% during the day on lower-than-expected earnings and a dismal revenue outlook. Today, markets are likely to get cautious start as investors turn wary of the Information Technology pack. Besides, weakness in Asian peers may impact the trading sentiments. Investors on Dalal Street await more of corporate earnings reports from India Inc for cues as the Q4 results season gathers steam. Foreign fund outflows likely to dent sentiments in the markets. National Stock Exchange's provisional data showed foreign institutional investors (FII) sold shares worth Rs 533.20 crore on April 17. Traders will be concerned as rating agency Moody's said defaults on loans to small and medium enterprises (SME) by finance companies in India are expected to rise in the coming quarters since hardening interest rates are increasing the repayment burden. Rising interest rates, increasing costs amid high inflation and a muted operations environment for small businesses have weighed on SME borrowers' ability to meet debt repayments over the past year. Meanwhile, the government has procured 41 lakh tonne wheat at the minimum support price directly from farmers so far in the ongoing 2023-24 marketing year (April-March), down 18 per cent from the year-ago period. Oil & gas industry stocks will be in focus as Union Minister for Petroleum and Natural Gas Hardeep Singh Puri said the government has set a target to increase the share of natural gas in the country's energy mix to up to 15 percent by the year 2030. There will be some reaction in road logistics sector stocks as ICRA said the Indian road logistics industry is expected to clock a high single-digit growth this fiscal on an elevated base of the previous year. The credit ratings agency also expects the demand momentum to continue in FY24, aided by stable domestic consumption and investment demand. Meanwhile, Shares of Avalon Technologies are set to debut on Dalal Street today. The issue price has been fixed as Rs 436 apiece -- the upper band of the offer.

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

Nifty Top volumes

• State Bank of India has re-launched its retail term deposit scheme Amrit Kalash.  
• HDFC Bank has received an approval for the issuance of Perpetual Debt Instruments, Tier II Capital Bonds and Long-Term Bonds up to total amount of Rs 50,000 crore over the period of next twelve months through private placement mode. 
• Maruti Suzuki India has launched its upgraded Light Commercial Vehicle - Super Carry.
• TCS has extended its partnership with the Canberra Times Marathon Festival, consolidating the company's role as the Presenting and Official App Partner until 2026.