Indian equity benchmarks reversed their early session losses to log modest gains on Tuesday following fag-end buying in Oil & Gas up, Energy and Metal stocks and a recovery in global equities. Markets made negative start and stayed in red for most part of the day, on the back of persistent foreign fund outflows. As per exchange data, foreign institutional investors (FIIs) remained net sellers in the capital market, as they sold shares worth Rs 1,278.42 crore on Monday. Firm crude oil prices in the international market also put pressure on equities. Some concern also came as Crisil in its latest report has said that a fourth of Indian micro, small and medium enterprises (MSMEs) have lost 3 per cent or more of their respective market share to big corporations during the Covid pandemic. It analysed MSMEs from 69 sectors and 147 clusters having a revenue of Rs 47 lakh crore or a fourth of India's GDP to arrive at the details on how the small businesses fared during the pandemic. However, key benchmark indices recovered at fag end to close with marginal gains, as traders found some solace with a report by the government think-tank NITI Aayog estimates India's gig economy could employ 2.35 crore people by FY30, representing a three-and-a-half-times increase over 10 years. The gig economy employed around 68 lakh people in FY20. Some support also came as the electronics and IT ministry has approved a total of 314 applications with proposed investments of Rs 86,824 crore under a modified special incentive package scheme till May 31, 2022. Meanwhile, India and the European Union (EU) resumed negotiations, after a gap of over eight years, for a comprehensive free trade agreement, a move aimed at strengthening economic ties between the two regions. Finally, the BSE Sensex rose 16.17 points or 0.03% to 53,177.45 and the CNX Nifty was up by 18.15 points or 0.11% to 15,850.20.

The US markets ended lower on Tuesday, removing earlier gains as the markets failed to keep their rebound from the bear-market lows going. Further, negative sentiment have been generated in reaction to a report from the Conference Board showing U.S. consumer confidence deteriorated to its lowest level in over a year in June. The Conference Board said its consumer confidence index slid to 98.7 in June from a downwardly revised 103.2 in May. Street had expected the index to drop to 101.0 from the 106.4 originally reported for the previous month. With the continued decrease, the consumer confidence index fell to its lowest level since hitting 95.2 in February of 2021. The report showed the expectations index tumbled to 66.4 in June from 73.7 in May, hitting its lowest level since March of 2013. However, the initial strength on markets partly reflected a positive reaction to news that China has cut quarantine times for international travelers in a big step toward easing Covid-19 controls. The news contributed to strength among travel and casino stocks, with Wynn Resorts and Las Vegas Sands showing significant moves to the upside. Banking stocks also saw early strength after several financial giants, including Morgan Stanley, Goldman Sachs, Bank of America and Wells Fargo, raised their dividends after passing the Federal Reserve's annual stress tests.

Crude oil futures ended sharply higher on Tuesday, magnifying their recent gains, as Saudi Arabia and the United Arab Emirates looked unlikely to be able to boost output significantly. UAE Energy Minister Suhail al-Mazrouei said on Monday that the UAE was producing near maximum capacity based on its quota of 3.168 million barrels per day (bpd) under the agreement with OPEC and its allies, a group known as OPEC+. Meanwhile, Leaders of the G7 group of wealthy nations said they will explore a potential ban on transporting Russian oil that has been sold above a certain price as they seek to step up pressure on Moscow over its invasion of Ukraine. Benchmark crude oil futures for August delivery rose $2.19 or 2 percent to settle at $111.76 a barrel on the New York Mercantile Exchange. Brent crude for August delivery surged $2.89 or 2.5 percent to settle at $117.98 a barrel on London's Intercontinental Exchange.

Indian rupee slumped to a fresh record low against the US dollar on Tuesday, primarily due to a sell-off in equities, rising inflationary pressures, and elevated global crude oil prices. Persistent selling by foreign institutional investors (FIIs) in the domestic markets also put pressure on the rupee. As per exchange data, FIIs remained net sellers in the capital market, as they sold shares worth Rs 1,278.42 crore on Monday. Market participants paid no heed towards a report by the government think-tank NITI Aayog which estimates India's gig economy could employ 2.35 crore people by FY30, representing a three-and-a-half-times increase over 10 years. The gig economy employed around 68 lakh people in FY20. On the global front, US dollar climbed on Tuesday on firmer oil prices while the euro held below $1.06 as European Central Bank (ECB) President Christine Lagarde offered no fresh insight on the central bank's policy outlook. Finally, the rupee ended at 78.85 (provisional), weaker by 48 paise from its previous close of 78.37 on Monday.

The FIIs as per Tuesday's data were net sellers in both equity and debt segment. In equity segment, the gross buying was of Rs 4480.46 crore against gross selling of Rs 5572.25 crore, while in the debt segment, the gross purchase was of Rs 372.66 crore against gross selling of Rs 1315.09 crore. Besides, in the hybrid segment, the gross buying was of Rs 0.48 crore against gross selling of Rs 16.87 crore.

The US markets ended lower on Tuesday as dire consumer confidence data dampened investor optimism and fueled worries over recession and the looming earnings season. Asian markets are trading mostly in red on Wednesday following a weak session on Wall Street overnight. Indian markets ended flat with positive bias after a highly volatile session on Tuesday as weakness in financial shares offset strength in oil & gas and IT scrips. Today, markets are likely to make negative start as global sentiments turn bearish coupled with rising crude oil prices. Continued selling in FIIs are likely to weight on markets. Foreign institutional investors (FIIs) sold shares worth a net Rs 1,244.44 crore on June 28. There will be some cautiousness with a private report that after a gap, the prices of select varieties of pulses have started rising for the past few days due to a delay in the onset of the southwest monsoon over major growing regions of Madhya Pradesh, Maharashtra, and Gujarat. Traders may take note of report that The GST Council approved changes in tax rates on some goods and services while allowing states to issue an e-way bill for intra-state movement of gold and precious stones. The Council also cleared a host of compliance procedures for GST-registered businesses along with a GoM report on high-risk tax payers to check evasion. However, some support may come later in the day as RBI data showed the growth in Scheduled Commercial Banks (SCBs) deposits moderated to 10 per cent year-on-year in March 2022, compared to an increase of 11.9 per cent a year ago. Meanwhile, A Niti Aayog report has underlined the need for technological improvisation and other incentives to promote electric two-wheeler in the country. Besides, Capital markets regulator Sebi came out with new adjustment rules for dividends in Futures and Options (F&O) scrips. Sebi said it has been decided that the adjustment in derivative contracts shall be carried out in cases where dividends declared are at or above 2 per cent of the market value of underlying stock. There will be some buzz in sugar stocks with a private report that India is considering allowing mills to ship out stocks of raw sugar that have piled up in ports and warehouses. Gaming industry stocks will be in focus as top online skill gaming associations expressed deep concern at reports that the GST rate on online skill games may be increased from existing 18 per cent to 28 per cent. There will be some reaction in Telecom stocks as the telecom department has issued rules for enterprises setting up Captive Non Public Network (CNPN), stipulating a minimum net worth of Rs 100 crore for applicants seeking direct assignment of spectrum from the government. Select port industry stocks will be in limelight with a private report that the government will strengthen capacity and technology at state-owned ports to make them competitive against their private peers.

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

Nifty Top volumes

• Cipla has agreed to acquire additional stake for Rs 25.90 crore in digital tech company GoApptiv.
• Mahindra & Mahindra has launched its much-awaited SUV - the All-New Scorpio-N - starting at Rs 11.99 lakh.
• Tata Motors is all set to increase price of its commercial vehicle range. 
• Coal India is gearing up to meet its part of committed coal supplies to the power sector in the coming months, as monsoon has hit many parts of the country.