In a highly volatile session, Indian equity benchmarks ended flat with negative bias amid mixed global cues. Markets made a gap down opening as traders were anxious with the provisional data available on the NSE showing that foreign institutional investors (FII) sold shares net worth Rs 1,622.69 crore on April 03, 2024. However, markets wiped off initial losses and turned mildly in green in late morning deals, as traders found solace with World Bank stating that the Indian economy is projected to grow at 7.5 per cent in 2024, revising its earlier projections for the same period by 1.2 per cent. Buying further crept in as the government has broadly met the tax collection target of over Rs 34.37 trillion for 2023-24 on the back of robust economic activity and improved compliance. The government had raised the target for direct tax collection in FY24 (April 2023 to March 2024) to Rs 19.45 trillion, while for indirect taxes (GST+ Customs + Excise) the target was lowered to Rs 14.84 trillion in the revised estimates (RE) presented in Parliament on February 1, 2024. Markets managed to keep their heads above water in late afternoon deals, as India Ratings and Research (Ind-Ra) has observed a notable increase in the resolution of cases under the Corporate Insolvency Resolution Process (CIRP), with the percentage of cases closed through the approval of resolution plans reaching 29% in Q3 FY24 (Q3 FY23: 17%).  However, markets failed to hold gains and ended flat as traders avoided to take any long positions as the RBI appointed MPC (Monetary Policy Committee) begin their 3-day meet to discuss policy measures. The RBI will announce the outcome on Friday. There are expectations that MPC may keep the repo rate unchanged. Finally, the BSE Sensex fell 27.09 points or 0.04% to 73,876.82 and the CNX Nifty was down by 18.65 points or 0.08% to 22,434.65.

The US markets ended mostly in green on Wednesday despite Federal Reserve Chair Jerome Powell reiterated that the central bank is not in a hurry to begin lowering interest rates. Powell pointed to higher inflation data over January and February as a reason for the Fed to be cautious but acknowledged it is too soon to say whether the recent readings represent more than just a bump. Powell said We do not expect that it will be appropriate to lower our policy rate until we have greater confidence that inflation is moving sustainably down toward 2 percent. He added Given the strength of the economy and progress on inflation so far, we have time to let the incoming data guide our decisions on policy. Nonetheless, Powell said he continues to believe rates are likely at their peak for this tightening cycle and noted most Fed officials see it as likely to be appropriate to begin lowering rates at some point this year. The Fed chief described the outlook as quite uncertain and suggested there are risks to both cutting rates too soon or too late. On the economic data front, service sector growth in the U.S. unexpectedly slowed in the month of March, the Institute for Supply Management (ISM) revealed in a report released. The ISM said its services PMI dipped to 51.4 in March from 52.6 in February. While a reading above 50 still indicates growth in the sector, street had expected the index to inch up to 52.7. The unexpected decrease by the headline index partly reflected a slowdown in the pace of growth in new orders, with the new orders index falling to 54.4 in March from 56.1 in February.

Crude oil futures ended higher on Wednesday after the Organization of the Petroleum Exporting Countries (OPEC) and allies, collectively known as OPEC+, ended their meeting without making any changes to their production policy. Further, concerns about disruptions to crude supplies amid escalating tensions between Israel and Iran also contributed to the rise in oil prices. However, data showing an unexpected increase in U.S. crude inventories in the week ended March 29th, capped oil's gains. According to a report released by the Energy Information Administration (EIA), crude oil inventories shot up by 3.2 million barrels last week, matching the surge seen in the previous week. The continued increase surprised street, who had expected crude oil inventories to fall by 1.5 million barrels. Benchmark crude oil futures for May delivery rose $0.28 or about 0.33% to settle at $85.43 a barrel on the New York Mercantile Exchange. Brent crude for June delivery gained $0.43 or 0.48% to $89.35 per barrel on London's Intercontinental Exchange.

Indian rupee depreciated against the dollar on Wednesday weighed down by elevated crude oil prices in international markets and persistent foreign fund outflows. A muted trend in domestic equities also dented investor sentiments. Traders overlooked the report that World Bank revised its earlier projection of Indian economy growth by 1.2 per cent to 7.5 per cent for FY23/24. Meanwhile, government has broadly met the tax collection target of over Rs 34.37 trillion for 2023-24 on the back of robust economic activity and improved compliance. The government had raised the target for direct tax collection in FY24 (April 2023 to March 2024) to Rs 19.45 trillion, while for indirect taxes (GST+ Customs + Excise) the target was lowered to Rs 14.84 trillion in the revised estimates (RE) presented in Parliament on February 1, 2024. On the global front, dollar held near an over four-month peak on Wednesday, pinning the yen close to its lowest its decades though the heightened threat of currency intervention by Tokyo capped further declines in the Japanese currency. Finally, the rupee ended at 83.47 (Provisional), weaker by 5 paise from its previous close of 83.42 on Tuesday.  

The FIIs as per Wednesday'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 14907.75 crore against gross selling of Rs 15355.04 crore, while in the debt segment, the gross purchase was of Rs 2627.70 crore with gross sales of Rs 1633.43 crore. Besides, in the hybrid segment, the gross buying was of Rs 12.90 crore against gross selling of Rs 12.60 crore.

The US markets ended mostly higher on Wednesday after the US Federal Reserve reaffirmed that the Fed will stick to its wait-and-see approach given the strength in the economy and high inflation rate. Asian markets are trading in green on Thursday following a sell-off in the previous session, as investors digest comments from US Federal Reserve Chairman Jerome Powell. China, Hong Kong, and Taiwan markets are closed today. Indian markets ended the narrow range trading session flat with negative bias on Wednesday amid weak global cues and lack of directional cues from domestic front. Today, domestic indices are likely to open in green tracking positive cues from Asian counterparts and ahead of the RBI policy outcome tomorrow. The Monetary Policy Committee (MPC) in the first policy review for this fiscal is likely to maintain status quo on the rates. Investors will also be looking for the Services PMI data to be out later in the day, for more directional cues. Some support will come as CBIC chairman Sanjay Kumar Agarwal said the indirect tax collection for FY24 has exceeded the revised estimates (RE) of Rs 14.84 trillion by a handsome margin, helped by a record GST mop-up. Tax collection is a reflection of economic activity. However, foreign fund outflows likely to dent sentiments, Foreign institutional investors (FIIs) net sold shares worth Rs 2,213.56 crore on April 3, provisional data from the NSE showed. There may be some cautiousness with a private report that merchandise exports from India for the financial year 2023-24 (FY24) may show a contraction of around 1-1.5 per cent after two consecutive years of growth, even as March is likely to witness robust double-digit growth. The final data is still being compiled and will be released by the commerce department on April 15. Meanwhile, The National Stock Exchange (NSE) has announced the launch of four new indices effective from April 8, in both the capital markets and Futures & Options segments. These four new indices are Nifty Tata Group 25 percent Cap, Nifty 500 Multicap India Manufacturing 50:30:20, Nifty 500 Multicap Infrastructure 50:30:20, and Nifty MidSmall Healthcare. Shares of oil explorers such as ONGC, Oil India and Reliance will be in focus after the government in its fortnightly review hiked windfall tax on petroleum crude to Rs 6,800 a metric tonne from Rs 4,900 earlier. Meanwhile, India, the world's third biggest oil consumer and importer, plans to build its first commercial crude oil strategic storage as part of efforts to shore up stockpiles as insurance against any supply disruption. Indian Strategic Petroleum Reserves (ISPRL), a special purpose vehicle created by the government for building and operating strategic petroleum reserves in the country, has invited bids for constructing 2.5 million tonnes of underground storage at Padur in Karnataka. Coal industry stocks will be in focus as a government statement said coal production from mines awarded to private miners for captive (self use) and commercial purposes touched 147 million tonnes (MT) in financial year 2023-24 (FY24). This is a 27 per cent jump over 2022-23 when their production stood at 116 MT.

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

Nifty Top volumes

• UltraTech Cement has commissioned two greenfield capacities totaling 5.4 mtpa in Chhattisgarh and Tamil Nadu.
• HCL Technologies has expanded alliance with Google Cloud to create industry solutions and drive business value with Gemini, its multimodal large language AI model.
• Axis Bank has received an approval from the Competition Commission of India for the subscription to 14,25,79,161 equity shares of Max Life Insurance Company.
• Tech Mahindra has entered into a strategic partnership with AVEVA driving digital transformation and sustainability for innovative business solutions, to establish a CoE.