Indian equity benchmarks erased most of their losses to end marginally lower on Friday. Key gauges made negative start and extended fall in morning deals, as traders were concerned with the latest public debt management report showing that the government's total liabilities rose 3.74 per cent to Rs 133.22 lakh crore in the March quarter from Rs 128.41 lakh crore in the three months ended December 2021. Some cautiousness also came as the Reserve Bank said India's external debt increased by $47.1 billion to $620.7 billion in the financial year ended March 2022. Some anxiety also came as RBI in its financial stability report said that persistently high inflation globally is to stay here longer than anticipated as the ongoing war and sanctions take toll on economies, threatening a further slowdown to global trade volume. Bourses remained under pressure in late afternoon deals with a private survey showed that India's factory output expanded at its slowest pace in nine months in June as elevated price pressures continued to dampen demand and output. While the Manufacturing Purchasing Managers' Index, compiled by S&P Global, remained resilient, it fell to a nine-month low of 53.9 in June from May's 54.6. Adding to the weakness, rating agency Crisil lowered its real GDP growth forecast for India to 7.3 percent in FY23 from 7.8 percent estimated earlier. It attributed the downward revision to higher oil prices, slowing of export demand, and high inflation. However, benchmark indices staged a smart recovery in the dying hours of trade, as traders took some support from the government data showing that the growth of eight core infrastructure sectors expanded by 18.1 per cent in May against 16.4 per cent in the year-ago period and 9.3 per cent in April 2022. Finally, the BSE Sensex fell 111.01 points or 0.21% to 52,907.93 and the CNX Nifty was down by 28.20 points or 0.18% to 15,752.05.

The US markets ended volatile session sharply higher on Friday as traders went bargain hunting following the significant decrease seen early in the session. Concerns about the possibility of tighter monetary policy triggering a global recession continue to weigh on the markets in early trading. Central banks from around the world have signaled their intent to continue to raising interest rates in an effort to fight inflation while acknowledging they can't guarantee a soft landing for the economy. Stocks came under pressure following the release of a report from the Institute for Supply Management showing the pace of growth in U.S. manufacturing activity slowed by more than expected in the month of June. The ISM said its manufacturing PMI slid to 53.0 in June from 56.1 in May, although a reading above 50 still indicates growth in the sector. Economists had expected the index to dip to 54.9. With the bigger than expected decrease, the manufacturing PMI slumped to its lowest level since hitting 52.4 in June of 2020. A separate report from the Commerce Department showed U.S. construction spending unexpectedly edged lower in the month of May. On the sectoral front, housing stocks moved sharply higher over the course of the trading session, driving the Philadelphia Housing Sector Index up by 3.9 percent. Substantial strength also emerged among gold stocks, as reflected by the 2.9 percent spike by the NYSE Arca Gold Bugs Index. The rally by gold stocks came despite a continued decrease by the price of the precious metal, with gold for August delivery falling $5.80 to $1,801.50 an ounce. Biotechnology stocks also showed a strong move to the upside on the day, resulting in a 2.5 percent jump by the NYSE Arca Biotechnology Index. Utilities, airline, retail and commercial real estate stocks also moved notably higher over the course of the session.

Crude oil futures settled significantly higher on Friday amid concerns about supply outages in Libya and likely shutdowns in Norway. There are fears that a strike by oil and gas workers in Norway on July 5 could result in a drop in the country's petroleum output by around 8%, or 320,000 barrels of oil equivalent per day. Traders also reacted to the declaration of force majeure by Libya's National Oil Corporation (NOC) at the Es Sider and Ras Lanuf ports, and the El Fell oilfield. A report from Baker Hughes said the oil rig count in the U.S. rose by one to 595 this week, the highest level since March 2020. Benchmark crude oil futures for August delivery rose $2.67 or 2.5 percent to settle at $108.43 a barrel on the New York Mercantile Exchange. Brent crude for September delivery surged $2.60 or 2.4 percent to settle at $111.63 a barrel on London's Intercontinental Exchange.

Indian rupee ended stronger against dollar on Friday due to fresh selling of the American currency by banks and exporters. Traders got some solace as  growth of eight core infrastructure industries grew to 13-month high of 18.1 per cent in May 2022, led by healthy growth in coal, crude oil, fertilisers, cement and electricity production. However, upside remain capped as CRISIL lowered its India real gross domestic product growth forecast for the current financial year to 7.3% from 7.8% earlier. Higher oil prices, slowing global demand for India's exports, and higher inflation are acting as the major drag factors. Meanwhile, government raised import taxes on gold, while increasing levies on exports of gasoline and diesel in an attempt to control a fast-widening current account gap. On the global front, sterling fell on Friday against the dollar as renewed fears of a global recession knocked the risk-sensitive British currency. Finally, the rupee ended at 78.94 (provisional), stronger by 12 paise from its previous close of 79.06 on Thursday.

The FIIs as per Friday's data were net sellers in both equity and debt segment. In equity segment, the gross buying was of Rs 10242.23 crore against gross selling of Rs 10503.02 crore, while in the debt segment, the gross purchase was of Rs 238.30 crore against gross selling of Rs 424.27 crore. Besides, in the hybrid segment, the gross buying was of Rs 28.52 crore against gross selling of Rs 20.04 crore.

The US markets ended higher on Friday as weak manufacturing and construction spending data helped raise expectations that the Federal Reserve might opt for a less aggressive pace of rate hikes in the months ahead. Asian markets are trading mostly in red on Monday despite positive cues from Wall Street. Indian markets ended slightly lower on Friday, with oil & gas stocks taking a heavy beating. Today, markets are likely to make weak start tracking weakness in Asian peers.  Also, investors await cues from the quarterly earnings season, with TCS all set to unveil its financial results later in the week. Traders will be concerned with continued FIIs selling. In June, FPIs sold equity worth Rs 50,145 crore through the stock market, taking the total FPI selling in CY 22 to Rs 2,23,944 crore. There will be some cautiousness with a private report that about 10 states in India have detected a new sub-variant of Omicron BA.2.75, which may be alarming in nature. Also, Sebi data showed that fund raising by listed companies through private placement of corporate bonds dropped 39 per cent to Rs 32,405 crore in the first two months of the current financial year, and outlook for the rest of the fiscal is uncertain too on expectation of further hike in interest rates. However, some support may come as GST collections in June witnessed a 56 per cent year-on-year rise to over Rs 1.44 lakh crore, Finance Minister Nirmala Sitharaman said, as she exhorted tax officers to ensure the system is so transparent that even an iota of discretion is not there. The gross GST collection in June is the second-highest collection after April when it was about Rs 1.68 lakh crore. Also, the Reserve Bank of India (RBI) said the country's foreign exchange reserves increased by $2.734 billion to $593.323 billion for the week ended June 24 on the back of a surge in the core currency assets. Traders may take note of finance minister Nirmala Sitharaman's statement that the government is watchful and mindful of the impact of falling rupee on the country's imports, while asserting that Indian currency has performed relatively better than others against dollar. Depreciation of rupee makes India's imports costlier, while on the other hand exports become attractive. Power stocks will be in focus as total outstanding dues owed by electricity distribution companies (discoms) to power producers rose by 4 per cent year-on-year to Rs 1,32,432 crore in June 2022. There will be some reaction in metal and oil industry stocks with a private report that the recently announced special tax on the export of steel, iron ore and petroleum products, and a windfall profit tax on crude oil producers are likely to hit the overall corporate earnings in FY23.

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

Nifty Top volumes

• Reliance Industries' brand licensing arm -- Reliance Brands has entered into a strategic partnership with Pret A Manger.
• Coal India has ended April-June quarter of FY23 capping a historic high of 29% output growth, compared to same quarter FY22.
• SBI Life Insurance Company has inked bancassurance pact with Paschim Banga Gramin Bank.
• NTPC has successfully started operation of last part capacity of 20 MW out of 100 MW Ramagundam Floating Solar PV Project at Ramagundam, Telangana.