Indian equity benchmarks gained for second straight session on Friday, led by strength in Metal, Banking, Basic Materials and Telecom shares amid positive global cues. The benchmarks traded in a narrow band in the first half of trade and jumped in noon deals, as traders got some solace with Chief Economic Adviser K.V. Subramanian's statement that food inflation is likely to moderate on account of the twin impact of opening up of economic activities and good monsoon and attributed the rise in food prices to restrictions imposed by several states during April-May to deal with the second wave of Covid-19. Traders found some support with Crisil's report that States' revenues is set to cross the Pre-Covid pandemic level in the current fiscal (FY22), driven by higher tax buoyancy, rise in sales tax collections from petroleum products coupled with increase in grants following 15th Finance Commission recommendations. It noted that revenue of the top 10 states had plunged 600 basis points (bps) last fiscal. Traders remain energized as industry body -- the National Association of Software and Service Companies (Nasscom) stating that India's share in the global engineering and research and development (ER&D) market is likely to grow at a compound annual growth rate (CAGR) of 12-13 per cent to reach $63 billion by 2025. Nasscom President Debjani Ghosh noted that the pandemic has altered the way consumers behave, interact with companies, and how businesses interact. She said ccontactless technologies, analytics, software-led systems are changing how products are designed, redesigned, engineered, and consumed. Meanwhile, asserting that continuous reforms make India a great place to do business, Finance Minister Nirmala Sitharaman invited global investors to take advantage of the recent FDI reforms, the privatisation policy and the performance linked incentive (PLI) scheme. Finally, the BSE Sensex rose 226.04 points or 0.43% to 52,925.04, while the CNX Nifty was up by 69.90 points or 0.44% to 15,860.35.

The US markets ended mostly higher on Friday as optimism about strong economic growth overshadowed concerns about inflation. The Federal Reserve last week forecast rate hikes in 2023, but traders seemed to bet on hopes a tighter monetary policy is not imminent and despite any tapering of asset purchase program sometime in the not-too-distant future, the program will continue to support markets until that time. The Fed is likely to begin tapering its asset purchase program in the not-too-distant future, but the program will continue to support the markets until that time. On the economic data front, a report from the Commerce Department showed the annual rate of core consumer price growth in May matched street estimates. The reading on inflation said to be preferred by the Fed showed the annual rate of core consumer price growth accelerated to 3.4 percent in May from 3.1 percent in April. The Commerce Department also said personal income slumped by 2.0 percent in May after plunging by 13.1 percent in April. Street had expected personal income to tumble by 2.5 percent. Meanwhile, the report showed personal spending was virtually unchanged in May after climbing by 0.9 percent in April. Personal spending was expected to rise by 0.4 percent. A report from the University of Michigan said that its consumer sentiment reading for the US was revised lower to 85.5 in June from a preliminary reading of 86.4. Although market had expected to score to come in at 87.4, it still remained the second-highest since start of the pandemic.

Crude oil futures settled higher on Friday as optimism about outlook for energy demand outweighed concerns about possible excess supply in the market in the event of OPEC+ deciding to increase crude production. The momentum in vaccine rollouts and the reopening of the economies in the US and several counties across Europe, traders are betting on hopes energy demand will see a significant rise. The Organization of the Petroleum Exporting Countries and their allies are scheduled to meet on July 1 to discuss further easing of their output cuts from August. Meanwhile, a report released by Baker Hughes showed the number of oil and gas rigs in the US stayed the same this week, at 470. Crude oil futures for August rose $0.75 or about 1 percent to settle at $74.05 barrel on the New York Mercantile Exchange. August Brent crude gained $0.46 or 0.61 percent to settle at $76.02 a barrel on London's Intercontinental Exchange.

Erasing previous session gains, Indian rupee ended tad lower against dollar on Friday on account of sustained dollar demand from importers and banks. Downfall remain capped as traders took some support with private report stating that the business activities across sectors such as auto, consumer goods and electronics, smartphones, ecommerce, hospitality and real estate picked up in June over May, amid falling infections and gradual relaxation of Covid-induced restrictions in various parts of the country. On the global front, sterling edged lower on Friday and was on track for its worst month versus the dollar since September after the Bank of England kept its policy unchanged. Finally, the rupee ended 74.20, weaker by 2 paise from its previous close of 74.18 on Thursday.

The FIIs as per Friday's data were net seller in both equity and debt segment. In equity segment, the gross buying was of Rs 9497.38 crore against gross selling of Rs 10277.61 crore, while in the debt segment, the gross purchase was of Rs 139.67 crore with gross sales of Rs 503.04 crore. Besides, in the hybrid segment, the gross buying was of Rs 4.26 crore against gross selling of Rs 1.92 crore.

The US markets ended mostly higher on Friday as optimism about strong economic growth outweighed concerns about inflation, prompting traders to build up fresh positions at several counters. Asian markets are trading mixed on Monday amid fears due to a rise in covid cases. All eyes will be on China's official factory activity data due Wednesday. Indian markets ended higher on Friday with Sensex at a record closing high boosted mainly by metal, banking and auto stocks. Today, the start of new week is likely to be flat-to-positive amid mixed global cues and fall in coronavirus cases. India recorded 46,643 cases in the last 24 hours, lowest since March 24, taking the country's total coronavirus caseload to 30,278,963. Traders will be taking encouragement as Economic think-tank NCAER expects the Indian economy to grow 8.4-10.1 percent for the current financial year as against a contraction of 7.3 percent in the last fiscal. Some support will come as in a relief to taxpayers in the country, the union government announced extension of several tax compliance deadlines including time to invest in residential house for tax deduction, payments under dispute resolution scheme. Traders may take note of report that although the second wave of the Covid-19 pandemic again brought businesses and economic activities to a standstill, Chairman of the State Bank of India (SBI), Dinesh Kumar Khara has expressed hope that the country's economy would recover in the ongoing financial year. Meanwhile, S&P Global Ratings said Indian states' weaknesses outweigh their strengths as they battle the Coronavirus (Covid-19) pandemic and they need financial support from the federal government, which is already dealing with drastically reduced revenue. However, traders may be concerned as India Ratings and Research (Ind-Ra) said India's FY22 GDP growth rate is now expected at 9.6 per cent, lower than an earlier estimate of 10.1 per cent.  There may be some cautiousness as the government's total liabilities stood at Rs 116.21 lakh crore at the end of March 2021, up 6.36 per cent from the previous quarter. The total liabilities (including liabilities under the Public Account) of the government were Rs 109.26 lakh crore at end-December 2020. Also, RBI data showed that sliding from a lifetime high, India's forex reserves declined by $4.148 billion to reach $603.933 billion for the week ended June 18 due to a fall in gold and currency assets. There will be some reaction in renewable energy sector stocks after Power Minister R K Singh said that as much as $70 billion (about Rs 5.2 lakh crore) has been invested in renewable energy across the country in the past seven years. Infrastructure stocks will be in focus with a private report that as many as 478 infrastructure projects, each worth Rs 150 crore or more, have been hit by cost overruns totalling more than Rs 4.4 lakh crore. Krishna Institute of Medical Sciences (KIMS Hospitals) and Dodla Dairy will make their stock market on Monday. The equity shares of these companies will be listed on the BSE and the National Stock Exchange (NSE). KIMS raised Rs 2,144 crore through its IPO while Dodla Dairy garnered Rs 520 crore from its public issue.

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

Nifty Top volumes

• Reliance Industries' majority-owned subsidiary -- Jio Platforms and Google have showcased jointly developed smartphone JioPhone Next. 
• SBI has launched the Aarogyam healthcare business loan, to provide enhanced support to the healthcare sector amid the pandemic. 
• Bajaj Finserv's EMI Store is offering No Cost EMI deals on a wide range of Mi TVs. 
• ONGC has reported consolidated net profit attributable to owners at Rs 9,404.16 crore for Q4FY21 as compared to net loss of Rs 6,338.12 crore for Q4FY20.