Indian equity benchmarks wiped out all the intra gains and ended marginally lower on Friday dragged by heavy selling in Power, Basic Materials, Utilities and Auto stocks. Market started on a positive note and stayed in green for most part of the day, as sentiments got boost as SBI Research projected the Indian economy to grow at 7.5 per cent in 2022-23, an upward revision of 20 basis points from its earlier estimate. It said given the high inflation and the subsequent upcoming rate hikes, we believe that real GDP will incrementally increase by Rs 11.1 lakh crore in FY23. Some optimism also came after the commerce ministry said India's merchandise exports rose by 15.46 per cent to $37.29 billion in May on account of healthy performance by sectors like petroleum products, electronic goods and chemicals, even as the trade deficit widened to $23.33 billion during the month. Traders also took note of Food Secretary Sudhanshu Pandey's statement that retail prices of wheat, rice, sugar and edible oils are showing a declining trend after the measures taken by the government, including curbs on exports of wheat and sugar. Key gauges maintained their upward momentum in the noon session, after India's dominant services sector expanded at the fastest pace in 11 years in May on strong demand, although inflationary pressures touched new highs, restricting optimism and weighing on consumers' pocketbooks. The S&P Global India Services Purchasing Managers' Index rose to 58.9 in May from 57.9 in April, its highest since April 2011 and comfortably beating the Reuters poll expectation of 57.5. However, key indices trimmed all of their gains to enter into negative terrain as traders got anxious with report stated that as the country's fiscal policy is moving in sync with the monetary policy amid the runaway inflation, the tightening measures along with rising subsidies imply that the consolidated fiscal deficit may remain elevated at 10.2 per cent of GDP in FY23, down 20 bps from FY22. Finally, the BSE Sensex fell 48.88 points or 0.09% to 55,769.23 and the CNX Nifty was down by 43.70 points or 0.26% to 16,584.30.

Erasing most of their previous session's gains, the US markets ended lower on Friday, with the tech-heavy Nasdaq showing a particularly steep drop. Traders booked profit on Thursday's strong gains, as stronger than expected jobs data offset the faint hopes that the Federal Reserve might slow its planned pace of interest rate hikes. The Labor Department's closely watched monthly employment report showed job growth in the U.S. exceeded economist estimates in the month of May. The report showed non-farm payroll employment jumped by 390,000 jobs in May after surging by an upwardly revised 436,000 jobs in April. Street had expected employment to increase by about 325,000 jobs compared to the addition of 428,000 jobs originally reported for the previous month. Meanwhile, the Labor Department said the unemployment rate remained unchanged at 3.6 percent. The unemployment rate was expected to edge down to 3.5 percent. The report also showed average hourly earnings rose by $0.10 or 0.3 percent to $31.95 in May. The annual rate of wage growth slowed to 5.2 percent in May from 5.5 percent in April. A separate report from the Institute for Supply Management showed growth in U.S. service sector activity slowed by slightly more than expected in the month of May. The ISM said its services PMI dipped to 55.9 in May from 57.1 in April, although a reading above 50 still indicates growth in the sector. Economists had expected the index to edge down to 56.4. With the bigger than expected decrease, the services PMI dropped to its lowest level since a matching reading in February of 2021. Moreover, A report on consumer price inflation is likely to be in focus next week along with reports on the U.S. trade deficit and consumer confidence.

Crude oil futures ended higher on Friday amid expectations of increased demand even as the Organization of the Petroleum Exporting Countries (OPEC) and its allies decided to increase output. Saudi Arabia and other OPEC+ states agreed to increase oil production to offset Russian output losses because of Western sanctions. Some optimism also came in with data showing a stronger than expected increase in U.S. non-farm payroll employment in the month of May. Meanwhile, the overall U.S. rig count remained unchanged at 727 this week, according to the latest tally from Baker Hughes Co. Benchmark crude oil futures for July delivery rose $2 or 1.7 percent to settle at $118.87 a barrel on the New York Mercantile Exchange. Brent crude for August delivery gained $2.11 or 1.8 percent to settle at $119.72 a barrel on London's Intercontinental Exchange.

Indian rupee ended weaker against the US dollar on Friday, on increased demand for the greenback from importers and banks. Traders were worried as report stated that as the country's fiscal policy is moving in sync with the monetary policy amid the runaway inflation, the tightening measures along with rising subsidies imply that the consolidated fiscal deficit may remain elevated at 10.2 per cent of GDP in FY23, down 20 bps from FY22. However, downfall remain capped as India's merchandise exports rose by 15.46 per cent to $37.29 billion in May 2022 as compared to $32.30 billion in the same month last year on account of healthy performance by sectors like petroleum products, electronic goods and chemicals. On the global front, dollar was little changed on Friday, even as risk appetite picked up ahead of U.S. jobs data. Finally, the rupee ended at 77.62 (Provisional), weaker by 2 paise from its previous close of 77.60 on Thursday.

The FIIs as per Friday's data were net sellers in equity, while net buyers in debt segment. In equity segment, the gross buying was of Rs 6948.77 crore against gross selling of Rs 7520.17 crore, while in the debt segment, the gross purchase was of Rs 748.50 crore with gross sales of Rs 170.52 crore. Besides, in the hybrid segment, the gross buying was of Rs 29.26 crore against gross selling of Rs 24.86 crore.

The US markets ended lower on Friday after a solid jobs report ate in to hopes for a pause in the Fed's aggressive policy-tightening which is needed to cool decades-high inflation. Asian markets are trading mixed on Monday as caution persist ahead of key US inflation data. Indian markets ended a volatile session marginally in the red on Friday, as gains in oil & gas and IT shares were offset by losses in financial stocks. Today, markets are likely to open in red amid weak global cues. All eyes will be on the Reserve Bank of India, which will begin its three-day monetary policy committee (MPC) meeting later today. As per a private report, with inflation showing no sign of abatement, the central bank is likely to increase benchmark lending rate in quick succession in its forthcoming monetary policy review on Wednesday, a hint for which has already been given by Governor Shaktikanta Das. Traders will be concerned as continuing its heavy selling spree for the eighth consecutive month, foreign investors pulled out nearly Rs 40,000 crore from the Indian equity market in May on fears of an aggressive rate hike by US Federal Reserve that dented investor sentiments. Some cautiousness may come as according to the Union Health Ministry data updated India logged 4,270 new coronavirus infections taking the tally of COVID-19 cases to 4,31,76,817, while the daily positivity rate was recorded above one per cent after 34 days. However, some support may come as RBI data showed that the country's foreign exchange reserves increased by $3.854 billion to $601.363 billion in the week ended May 27. In the previous week, the reserves rose by $4.230 billion to $597.509 billion. Meanwhile, Capital markets regulator Sebi came out with a new framework for investor grievance redressal mechanism as part of its effort to strengthen the process. There will be some buzz in the insurance industry stocks as Crisil Ratings said in a report the recent increase in the premium rates on third-party motor insurance is unlikely to fully offset the motor insurance segment's underwriting losses. Coal industry stocks will be in focus as Coal Minister Pralhad Joshi said to address the country's energy demand which is set to double by 2040, thermal coal requirement would go up to around 1,500 million tonnes in the next 18 years. There will be some reaction in agriculture related stocks with a private report that the government may announce higher-than-usual increases in minimum support prices (MSP) for the summer-sown crops in 2022-23 year soon, taking into consideration a sharp rise in costs of farming inputs. The primary markets will see the opening of a new issue - Silver Pearl Hospitality and Luxury Spaces. The three-day IPO will open today with an issue price of Rs 18 per share.

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

Nifty Top volumes

• The coal ministry has floated a draft cabinet note for seeking inter-ministerial views on the proposal to list 25 percent shares of Coal India's arm Bharat Coking Coal. 
• Oil and Natural Gas Corporation has applied for the petroleum exploration license before the state government. 
• Bharti Airtel's subsidiary -- Airtel Payments Bank has collaborated with Muthoot Finance to offer gold loans through Airtel Thanks app.  
• ITC's subsidiary company -- ITC Infotech has paid an amount of $33 million (around Rs 256 crore) to PTC as part of an agreement to acquire a substantial portion of the American company's product lifecycle management implementation services.