Indian equity benchmarks buckled under selling pressure for the second straight session on Friday as a bearish trend in global equities and concerns over rate hikes by central banks unnerved investors. Markets made a negative start and stayed in red for whole day as traders were concerned with the minutes of the June MPC released by the central bank revealing that sounding a note of caution, RBI's rate-setting panel member Jayanth R Varma opined that monetary policy is now dangerously close to levels at which it can inflict significant damage to the economy.  Some concern also came with the Solvent Extractors Association (SEA) stating that the slow monsoon was causing a delay in the sowing of oilseeds in the ongoing kharif season, which might impact production. It added area sown to oilseeds remained low at 0.41 million hectares till last week, as against 0.48 million hectares in the year-ago period. However, markets managed to trim most of their losses in early afternoon deals, as traders found some support with India and the US have stating that they are looking forward to the reconvening of the India-US Trade Policy Forum later this year to further enhance trade relationship and identify new areas for engagement. A joint statement issued after a meeting between Prime Minister Narendra Modi and US President Joe Biden showed that the two countries have also taken steps towards deepening bilateral cooperation to strengthen economic relationship, including trade ties. The street took a note of Finance Minister Nirmala Sitharaman's statement that digital public infrastructure has allowed India to make optimum use of taxpayers' money. Sitharaman said today in India the government is able to send most of the benefits directly to the bank accounts of citizens. But, markets failed to hold recovery and enlarged their losses in late afternoon session as the provisional data available on the NSE showed that foreign institutional investors (FII) offloaded shares worth a net Rs 693.28 crore on June 22. Finally, the BSE Sensex fell 259.52 points or 0.41% to 62,979.37 and the CNX Nifty was down by 105.75 points or 0.56% to 18,665.50.

The U.S. markets ended lower on Friday amid ongoing concerns about the outlook for interest rates and the global economy. Rate hikes in England and other countries along with the Federal Reserve's forecast for additional rate increases have reignited worries tighter monetary policy will tip the global economy into recession. Overall trading activity remained somewhat subdued, with a lack of major U.S. economic data keeping some traders on the sidelines. The economic calendar picks back up next week with the release of reports on durable goods orders, consumer confidence, new home sales and pending home sales. The Commerce Department is also due to release its report on personal income and spending in the month of May, which includes a reading on inflation said to be preferred by the Fed. The consumer price inflation data could significantly impact opinions regarding whether the Fed will follow through on its forecast rate hikes. On the sectoral front, Networking stocks showed a significant move to the downside on the day, resulting in a 2.1 percent slump by the NYSE Arca Networking Index. Significant weakness was also visible among semiconductor stocks, as reflected by the 1.8 percent loss posted by the Philadelphia Semiconductor Index. Interest-sensitive utilities stocks also saw considerable weakness, dragging the Dow Jones Utility Average down by 1.6 percent. Natural gas, computer hardware and commercial real estate stocks also moved notably lower over the course of the session.

Crude oil futures ended lower on Friday, magnifying recent losses, on concerns about the outlook for energy demand following a slew of interest rate hikes by central banks and prospects of further tightening raising concerns about economic growth. Besides, oil prices also fell as the S&P Global US Composite PMI dropped to 53.0 in June 2023, down from 54.3 in the previous month, according to preliminary estimate. Benchmark crude oil futures for August delivery fell $0.35 or about 0.50 percent to settle at $69.16 a barrel on the New York Mercantile Exchange. Brent crude for August delivery dropped $0.29 or 0.40 percent to settle at $73.85 a barrel on London's Intercontinental Exchange.

Rupee settled lower against dollar on Friday amid strong American currency against major rivals overseas and negative sentiment in equity markets. Outflow of foreign funds from domestic equities also put pressure on the local unit. Traders were concerned as the minutes of the June MPC released by the central bank revealed that sounding a note of caution, RBI's rate-setting panel member Jayanth R Varma opined that monetary policy is now dangerously close to levels at which it can inflict significant damage to the economy. On the global front, the euro fell after the bloc's business growth virtually stalled this month, as the dollar drew support from a bout of risk aversion on Friday and hawkish comments from global central banks, including the Federal Reserve. Finally, the rupee ended at 82.02 (Provisional), weaker by 5 paise from its previous close of 81.97 on Thursday.

The FIIs as per Friday's data were net buyers in equity segment, while net sellers in debt segment. In equity segment, the gross buying was of Rs 9785.40 crore against gross selling of Rs 8839.12 crore, while in the debt segment, the gross purchase was of Rs 237.50 crore against gross selling of Rs 3692.61 crore. Besides, in the hybrid segment, the gross buying was of Rs 9.42 crore against gross selling of Rs 27.16 crore.

The US markets ended lower on Friday on global recession fears. Asian markets are trading mostly lower in early deals on Monday, following negative cues from US markets, as traders continued to react to the aggressive monetary tightening by major central banks last week. Indian equity markets ended in red on Friday mirroring weakness across global markets as investors remained concerned about more of aggressive rate hikes in central banks' ongoing fight against sticky inflation. Today, markets are likely to make cautious start amid weak cues from global markets. There will be cautiousness in the markets as the Reserve Bank of India (RBI) paper has said inflation is slowing down personal consumption expenditure, which in turn is moderating corporate sales and holding back private investment in capacity creation. Traders may be concerned as a wave of interest-rate hikes and hawkish commentary from international central bankers revived worries about global economic growth. However, traders may get some support later in the day as the Reserve Bank of India said India's forex reserves increased by USD 2.35 billion to USD 596.098 billion for the week ended June 16. Traders will be getting encouragement as Commerce and Industry Minister Piyush Goyal has said the Export Credit Guarantee Corporation (ECGC) has supported over 16,000 exporters with an aggregate value of business covered to the tune of Rs 6.68 lakh crore in 2022-23 and it is expected to increase to more than Rs 10 lakh crore this fiscal. The ECGC, wholly owned by the Government of India, was set up in 1957 with the objective of promoting exports from the country by providing credit risk insurance and related services. Traders may take a note of private report that India and Australia plan to conclude negotiations for a comprehensive trade pact by December, a year after implementing the interim Economic Cooperation and Trade Agreement (ECTA).

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

Nifty Top volumes

•  HDFC has executed definitive agreements for subscription of 6,068 equity shares of Bonito Designs.
•  Dr. Reddy's Laboratories has entered into the trade generics business in India with the launch of its new dedicated division RGenX.
•  Asian Paints has acquired further 11% of the equity share capital of White Teak for a consideration of around Rs 54 crore from the promoters of White Teak.
•  Bajaj Finserv's subsidiary -- Bajaj Markets is granting one access to a range of gold loans from multiple lending partners.