In a volatile session, Indian equity benchmarks erased all of their day's gains after lifetime highs and ended marginally lower on Friday amid profit booking. Markets made a strong opening, as sentiment got a boost with Union Finance Minister Nirmala Sitharaman's statement that the National Asset Reconstruction Company (NARCL) would be operational soon, and it had to ensure resolving bad loans within five years, beyond which the guarantee to be issued by the government would expire. The Cabinet approved a government guarantee of Rs 30,600 crore to be provided for the security receipts issued by the NARCL to buy bad loans of lenders. Further, support also came in as the Reserve Bank of India (RBI) said prospects are brightening for the Indian economy achieving escape velocity from the pandemic as the second wave of COVID-19 wanes and preparedness for future remains on war-alert status. It said aggregate demand is gaining firmer ground, while on the supply side, IIP and core industries mirror improvement in industrial activity and services sector indicators point towards sustained recovery. However, the market witnessed a late bout of profit-taking towards the closing stages. Traders overlooked India Ratings' report stated that with the resumption of economic activity, the collection efficiency for securitisation transactions moved up from 67 per cent in May 2021 to 79 per cent in July. However, it is yet to reach March 2021 levels of 83 per cent. Meanwhile, in order to rave up the innovation and entrepreneurship ecosystem across the country, Atal Innovation Mission (AIM) NITI Aayog has inked partnership with Dassault Systemes. In this regard a Statement of Intent (SoI) was signed between AIM and Dassault Systemes in a virtual event to support various current and future initiatives of AIM programs and AIM beneficiaries in India. Finally, the BSE Sensex fell 125.27 points or 0.21% to 59,015.89 and the CNX Nifty was down by 44.35 points or 0.25% to 17,585.15.

The US markets ended lower on Friday as traders looked ahead to the Federal Reserve's highly anticipated monetary policy meeting next week. The Fed is widely expected to leave monetary policy unchanged but could address the outlook for its asset purchase program. The minutes of the Fed's last meeting signaled the central bank was prepared to begin scaling back asset purchases by the end of the year. Markets saw some further downside following the release of a report from the University of Michigan showing US consumer sentiment rebounded less than expected in September. The report said the consumer sentiment index inched up by 71.0 in September from 70.3 in August. Street had expected the index to rise to 72.2. The modest increase came after the consumer sentiment index tumbled to its lowest level since December of 2011 in the previous month.

Crude oil futures ended lower on Friday as prices declined on reports that crude supply is getting restored slowly after Hurricanes Ida and Nicholas had impacted production in the US Gulf of Mexico. Despite the restoration of supply, a report from the Bureau of Safety and Environmental Enforcement estimated that approximately 28% of the current oil production in the Gulf of Mexico is still shut in. A firm dollar also contributed to the decline in crude oil prices. Crude oil futures fell $0.64 or 0.9 percent to settle at $71.97 barrel on the New York Mercantile Exchange. November Brent crude dropped $0.33 or 0.4 percent to settle at $75.34 a barrel on London's Intercontinental Exchange. 

Indian rupee ended stronger against dollar on Friday due to fresh selling of the American currency by banks and exporters. Some support came as Reserve Bank of India (RBI) said the inflation trajectory is coming down faster than anticipated and the inflation print of 5.3 per cent in August has proven the monetary policy committee's (MPC) move to look through May's price shock as the right call. However, upside remain limited traders were cautious as Finance Minister Nirmala Sitharaman is chairing the 45th meeting of the Goods and Service Tax (GST) Council in Lucknow today. The meeting is the first in-person meeting of the GST Council in nearly two years. Extension of compensation to states beyond 2022 is expected to be on the agenda. The Council will likely discuss rationalizing an inverted duty structure. On the global front; sterling held below a recent one-month high versus the dollar on Friday as UK retail sales undershot expectations, while some investment banks brought forward their forecast for a Bank of England rate rise to the middle of 2022. Finally, the rupee ended 73.48, stronger by 4 paise from its previous close of 73.52 on Thursday. The currency touched a high and low of 73.55 and 73.42 respectively.

The FIIs as per Friday's data were net buyer in both equity and debt segment. In equity segment, the gross buying was of Rs 11763.37 crore against gross selling of Rs 9923.90 crore, while in the debt segment, the gross purchase was of Rs 2981.15 crore with gross sales of Rs 2066.18 crore. Besides, in the hybrid segment, the gross buying was of Rs 68.94 crore against gross selling of Rs 22.69 crore.

The US markets end lower on Friday as investors remain cautious due to a resurgent Covid virus, a Federal Reserve meeting next week and a historical tendency for September to be a weak month for equities. Asian markets are trading mostly lower in early deals on Monday ahead of a week graced with no less than a dozen central bank meetings, highlighted by the Federal Reserve which is likely to take another step toward tapering. Indian equity benchmarks ended lower on Friday on profit booking. Today, the start is likely to be weak tailing the sluggishness in the global indices. Traders will be cautious as the country's foreign exchange reserves declined by USD 1.34 billion to USD 641.113 billion in the week ended September 10, 2021, according to RBI data. During the reporting week ended September 10, the fall in the reserves was on account of a decline in Foreign Currency Assets (FCAs), a major component of the overall reserves. Traders may take note of report that President Ram Nath Kovind said the Covid pandemic hit the country's economy hard and the government has taken various fiscal measures to alleviate distress and help the poor. However, some respite may come later in the day as Commerce and Industry Minister Piyush Goyal said simplification, facilitation and ease of doing business has helped India create more startups. He said for promoting startups, the government is creating future global leaders and wants to become the innovation hub of the world. Markets may get some support as the GST Council in its meeting stated that businesses that default on filing summary return and paying monthly GST will not be able to file GSTR-1 sales return of the succeeding month from January 1 next year. It has decided to take a host of measures to streamline compliance, including mandatory Aadhaar authentication for businesses to file refund claims. These moves would help prevent revenue leakage due to evasion of Goods and Services Tax (GST), which was launched on July 1, 2017. Meanwhile, after the World Bank announced its decision to discontinue the next Doing Business ranking report, a senior government official said the move will not have any impact on the investment climate in India. India's ongoing reforms to improve business climate will continue. There will be some reaction in Aviation stocks as the Ministry of Civil Aviation stated that airlines can now operate a maximum of 85 per cent of their pre-Covid domestic flights instead of the 72.5 per cent allowed till date. There may be some buzz in pharmaceutical sector's stocks on report that the government extended the period of concessional GST rates on certain COVID-related drugs by three months till December 31 but decided not to give the same benefit to medical equipment. The concessional regime for certain medical equipment will end on September 30.

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

Nifty Top volumes

•  Kotak Mahindra Bank has entered into partnership with the Indian Institute of Science to set up a state-of-the-art Artificial Intelligence & Machine Learning Centre at the IISc campus.
•  Tech Mahindra has inked a long term partnership with the World's Best University for Sport, Loughborough University.
•  Infosys is planning to collaborate with Frost Bank to provide strategic business consulting and digital capabilities that will enable Frost Bank to offer mortgage loans.
•  Tata Motors has launched a special edition of its flagship model Safari priced at Rs 21.89 lakh (ex-showroom) to further spruce up the range ahead of the festive season.