Snapping their six-day winning streak, Indian equity benchmarks witnessed profit taking on Friday and shed over a percent, as a few big companies disappointed market sentiments with their first-quarter earnings. Weak global cues and selling by domestic institutional investors also hurt sentiments. After the initial gap-down opening, markets drifted gradually lower, as traders were concerned after latest payroll data released by the Employees' Provident Fund Organisation (EPFO) showed that formal job creation slowed in May after recovering slightly at the turn of the fiscal year in the previous month. The number of new monthly subscribers under the EPF declined by close to 1 per cent to 883,176 in May from 891,974 in April. Sentiments remained down-beat with private report stating that private equity and venture capital (PE/VC) funds' investments into Indian entities declined by nearly a fourth to $27.5 billion in January-June 2023 against the year-ago period. Markets extended fall and traded deep in red in late afternoon session, as traders remained anxious with data showing that retail inflation for farm workers and rural labourers inched up marginally to 6.31 per cent and 6.16 per cent, respectively in June as compared to 5.99 per cent and 5.84 per cent in May this year. The All-India Consumer Price Index Number for Agricultural Labourers and Rural Labourers for June 2023 increased by 10 points each to 1,196 points and 1,207 points, respectively. CPI-AL and CPI-RL were 1,186 points and 1,197 points in May 2023. Traders overlooked S&P Global Ratings' report in which it has projected Indian banking sector's weak loans will decline to 3-3.5 per cent of gross advances by March 31, 2025 as structural improvements and good economic prospects would support the resilience of financial institutions. In its mid-year global bank outlook, S&P said India's economic growth prospects should remain strong over the medium term, with GDP expanding 6-7.1 per cent annually in fiscal years 2024-2026. Finally, the BSE Sensex fell 887.64 points or 1.31% to 66,684.26 and the CNX Nifty was down by 234.15 points or 1.17% to 19,745.00.

The US markets ended mostly higher on Friday.  Markets showed a lack of direction throughout day. The choppy trading on markets came as traders seemed reluctant to make significant moves ahead of the Federal Reserve's highly anticipated monetary policy meeting next week. With the Fed widely expected to raise interest rates by another 25 basis point, traders are likely to pay close attention to the accompanying statement for clues about the outlook for rates. Recent encouraging inflation data has led to optimism next week's rate hike will be the last, and traders will be looking for confirmation from the Fed.  A lack of major U.S. economic data also kept traders on the sidelines following the release of several key reports earlier in the week. On the sectoral front, Interest rate-sensitive utilities stocks showed a strong move to the upside, however, with the Dow Jones Utility Average climbing by 1.3 percent to a two-month closing high. Notable strength was also visible among airline stocks, as reflected by the 1.1 percent gain posted by the NYSE Arca Airline Index. Healthcare, oil and semiconductor stocks also saw some strength on the day, while tobacco and banking stocks moved to the downside.  Among individual stocks, shares of American Express (AXP) moved sharply lower after the credit card giant reported better than expected second quarter earnings but weaker than expected revenues.

Crude oil futures ended sharply higher on Friday, buoyed by growing evidence of supply shortages in the coming months and rising tensions between Russia and Ukraine that could further hit supplies. Russia hit Ukrainian food export facilities for a fourth day in a row on Friday and practiced seizing ships in the Black Sea, in an escalation of tensions in the region since Moscow's withdrawal this week from a U.N.-brokered safe sea corridor agreement. Benchmark crude oil futures for September delivery rose $1.42 or about 1.9 percent to settle at $77.07 a barrel on the New York Mercantile Exchange. Brent crude for September delivery gained $1.43 or about 1.80 percent to settle at $81.07 a barrel on London's Intercontinental Exchange.

Rupee settled lower against dollar on Friday weighed down by a rebound in the American currency and firm crude oil prices in global markets. Besides, a negative trend in domestic equity benchmarks also dented investor sentiment. Traders were concerned as latest payroll data released by the Employees' Provident Fund Organisation (EPFO) showed that formal job creation slowed in May after recovering slightly at the turn of the fiscal year in the previous month. The number of new monthly subscribers under the EPF declined by close to 1 per cent to 883,176 in May from 891,974 in April. Besides, private report stated that private equity and venture capital (PE/VC) funds' investments into Indian entities declined by nearly a fourth to $27.5 billion in January-June 2023 against the year-ago period. On the global front, the pound was on track for its biggest weekly fall since February on Friday, as markets reacted decisively to signs that Britain may finally be turning a page on inflation. Finally, the rupee ended at 81.97 (Provisional), weaker by 4 paise from its previous close of 81.93 on Thursday.

The FIIs as per Friday's data were net buyers in both equity and debt segments. In equity segment, the gross buying was of Rs 12338.92 crore against gross selling of Rs 7700.05 crore, while in the debt segment, the gross purchase was of Rs 1608.07 crore with gross sales of Rs 551.42 crore. Besides, in the hybrid segment, the gross buying was of Rs 3.30 crore against gross selling of Rs 10.34 crore.

The US markets ended mostly in green on Friday as investors awaited a batch of key earnings reports and a major policy decision from the Federal Reserve. Asian markets are trading mixed on Monday as investors tamed down stimulus expectations ahead of this week's Politburo meeting. Indian markets tumbled on Friday, with IT stocks suffering heavy losses after Infosys reported its weakest June quarter revenue growth since FY21 and slashed its annual sales forecast for the current fiscal year. Today, markets are likely to get negative start as global investors look forward to US Fed's interest rate decision this week. Traders will be concerned as retail inflation for farm workers and rural labourers inched up marginally to 6.31 per cent and 6.16 per cent, respectively in June as compared to 5.99 per cent and 5.84 per cent in May this year. The All-India Consumer Price Index Number for Agricultural Labourers and Rural Labourers for June 2023 increased by 10 points each to 1,196 points and 1,207 points, respectively.  Some pessimism will come as a private report that consumer price inflation is expected to overshoot the Reserve Bank's tolerance mark of 6 per cent again in July and August due to the sky high vegetable prices. However, some respite may come later in the day as Indian equity markets continue to draw foreign portfolio investments as foreign investors put in Rs 43,800 crore in July so far on stable macroeconomic fundamentals, steady earnings growth and challenges faced by the Chinese economy. Some optimism may come as the Reserve Bank of India said India's forex reserves have swelled by $12.743 billion to $609.022 billion in the week ended July 14, making it one of the strongest weekly surges in the kitty in recent times. Some support may come as a new World Economic Forum report the agriculture sector in India can be transformed by promoting the use of artificial intelligence (AI) and other emerging technologies. Adani group stocks will be in focus as the Adani group has exited the financial services business by selling its entire 90 per cent stake in Adani Capital and Adani Housing to private equity (PE) firm Bain Capital for Rs 1,440 crore. The total valuation of the Adani financial services business stands at Rs 1,600 crore. Besides, the April-June quarter results of fiscal year 2023-24 (Q1FY24) will continue to remain in focus. Companies like TVS Motor, Tata Steel, HDFC AMC, JK Paper, among others will report quarterly results on Monday, July 24.

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

Nifty Top volumes

• L&T's construction arm -- L&T construction has secured order for its Heavy Civil Infrastructure Business from NHSRCL. 
• IndusInd Bank has received an approval for raising of funds through debt securities in any permitted mode on a private placement basis as may be decided, for an aggregate amount of Rs 20,000 crore. 
• HCL Technologies has joined the XR Startup Program, an initiative between Meta and the MeitY Startup Hub to discover, nurture and accelerate extended reality technology startups in India.
• JSW Steel has reported over 2-fold jump in its consolidated net profit at Rs 2,428 crore for the quarter ended June 30, 2023 as compared to Rs 839 crore for the same quarter in the previous year.