Indian equity benchmarks traded volatile on Friday but managed to end in green for second straight session, following buying in Realty, IT and Metal stocks and firm cues from the US markets. After flat start, markets gained traction and were trading higher as traders took support with Additional Secretary in the commerce ministry Rajesh Agrawal's statement that India's agriculture exports this fiscal are expected to reach the last year's level of $53 billion despite restrictions imposed on shipments of certain key commodities, including rice, wheat and sugar. Traders took a note of Finance Minister Nirmala Sitharaman's statement that Central Public Sector Enterprises (CPSEs) have made 34.63 per cent of their total procurement from MSMEs in 2023-24 (till November) as against the mandated 25 per cent. However, volatility struck the bourses in afternoon deals, as markets trimmed most of their early gains amid foreign fund outflows. Provisional data from the National Stock Exchange (NSE) showed that foreign institutional investors (FIIs) net sold shares worth Rs 1,636.19 crore on December 21. Some concern also came as crude oil futures surged due to Red Sea route avoidance post-Houthi militant attacks, impacting MCX January and February crude futures. However, final-hour buying helped indices to close near the day's high. Meanwhile, the Reserve Bank of India (RBI) said it will conduct a seven-day variable rate repo auction for a notified amount of Rs 1.75 lakh crore on December 22. This announcement came when the liquidity in the banking system was in a huge deficit of around Rs 2.27 lakh crore. Finally, the BSE Sensex rose 241.86 points or 0.34% to 71,106.96 and the CNX Nifty was up by 94.35 points or 0.44% to 21,349.40.

The US markets were closed on Monday on account of Christmas.

Indian rupee ended higher against dollar on Friday on selling of American currency by banks and exporters and positive trend in domestic equities. Traders got support with Additional Secretary in the commerce ministry Rajesh Agrawal's statement that India's agriculture exports this fiscal are expected to reach the last year's level of $53 billion despite restrictions imposed on shipments of certain key commodities, including rice, wheat and sugar. However, gains remain capped due to continuous upward movement in the crude oil price triggered by evolving geopolitical situation and outflow of foreign funds. Provisional data from the National Stock Exchange (NSE) showed that foreign institutional investors (FIIs) net sold shares worth Rs 1,636.19 crore on December 21. On the global front, the dollar inched up on Friday ahead of U.S. inflation data that could shape expectations for how quickly interest rates might fall in 2024. Finally, the rupee ended at 83.16 (Provisional), stronger by 11 paise from its previous close of 83.27 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 10105.46 crore against gross selling of Rs 11416.62 crore, while in the debt segment, the gross purchase was of Rs 1939.38 crore with gross sales of Rs 1486.04 crore. Besides, in the hybrid segment, the gross buying was of Rs 19.01 crore against gross selling of Rs 16.53 crore.

The US markets remained closed on Monday on account of Christmas. On Friday, markets ended mostly higher after revised data released by the University of Michigan showed consumer sentiment in the U.S. improved by slightly more than initially estimated in the month of December. Asian markets are trading mixed on Tuesday in thin trade as investors were still digesting data released on Friday that showed U.S. prices fell in November for the first time in more than 3-1/2 years, underscoring the economy's durability. Indian markets ended higher for the second consecutive session on Friday amid buying across the sectors, barring banks. Today, domestic indices are likely to resume trade after the extended holiday break on positive note. Markets were closed on Monday owing to the Christmas holiday. Foreign fund inflows likely to aid sentiments. Foreign portfolio investors (FPIs) have injected over Rs 57,300 crore into the Indian equity markets this month so far owing to political stability, robust economic growth, and a steady decline in the US bond yields. With this, total investment by FPIs surpassed Rs 1.62 lakh crore this year. Traders will be taking encouragement as leading credit rating firm Fitch Ratings expects that India's resilient economic growth will boost demand of the corporates. In its latest research report on India Corporates: Sector Trends 2024, Fitch said that this is a sequel to the robust performance of the corporates in 2023 and will offset weakness from slowing growth in the key overseas markets. Some support will come as latest data from the Reserve Bank of India (RBI) showed that forex reserves rose $9.1 billion to a near two-year high of $616 billion in the week ended December 15. The quantum of increase in the week ended December 15 is the highest since July 14. Some optimism will come with report that foreign direct investments into India is likely to gather momentum in 2024 as healthy macroeconomic numbers, better industrial output as well as attractive PLI schemes will attract more overseas players amid geopolitical headwinds and tighter interest rate regime globally. Traders may take note of Food and Consumer Affairs Minister Piyush Goyal's statement that the Centre has taken many pro-active steps in last few years to control retail prices of food items and added the government will keep inflation under control while ensuring country's economic growth. However, a surge in new Covid-19 cases may cap the upside. India logged a total of 628 new Covid-19 cases in the last 24 hours, while the active caseload jumped to 4,054. Also, trading activity may remain volatility this week due to the scheduled expiry of December month derivative contracts and major economic data. There will be some reaction in oil & gas sector stocks data from the Petroleum Planning and Analysis Cell showed that the country's crude import bill decreased significantly to $87.1 billion in the April to November period from $113.4 billion in the same period last fiscal even as the import volume remained largely unchanged. Meanwhile, Muthoot Microfin and Suraj Estate Developers will debut on the bourses today.

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

Nifty Top volumes

• Tata Motors' subsidiary -- Tata Passenger Electric Mobility has launched its TATA.ev stores, catering solely to EV customers.
• Bharti Airtel's video streaming service -- Airtel Xstream Play has partnered with aha Tamil and Telugu.
• HDFC Life Insurance Company and NKGSB Co-operative Bank have entered into a Corporate Agency tie-up enabling NKGSB Co-operative Bank customers to avail life insurance products of HDFC Life.
• UPL has received approval for the proposal for fund raising for an amount aggregating upto Rs 4,200 crore subject to receipt of statutory / regulatory approvals.