Indian equity benchmarks ended in red for third straight day, tracking losses in index heavyweights Bajaj Finance, Kotak Mahindra Bank, Mahindra & Mahindra and Nestle amid a weak trend in global markets. That apart, expiry of the weekly F&O contracts also added to the volatility. Markets made flat-to-positive start, as Global forecasting firm Oxford Economics revised India's economic growth projection for 2021 to 10.2 per cent from the earlier 8.8 per cent, citing receding COVID-19 risks and the shift in the monetary policy outlook. It further said the Budget 2021-22 will create positive externalities for the private sector, and forecast slower fiscal consolidation in FY22 than the government projections. Sentiments remained positive with S&P Global Ratings' report stated that India will be one of the fastest growing emerging market economies with a 10 percent growth in FY22, and future sovereign rating action would hinge on lowering fiscal deficit and sustaining debt burden. However, key indices erased gains to turn negative in late morning deals, as the government issued new guidelines for international arrivals amid the spread of mutant variants of coronavirus in many countries. The new Standard Operating Procedures (SOPs) will come into effect from 23.59 hours on February 22 till further orders. Market participants paid no heed towards with commerce and Industry Minister Piyush Goyal's statement that he will engage with the new United States Trade Representative (USTR) for a fresh trade package as both the countries would have to look afresh at different ideas. Meanwhile, a private report stated that India has emerged as Asia's biggest destination for financial technology (fintech) deals, leaving behind China in the quarter ended June 2020. Finally, the BSE Sensex fell 379.14 points or 0.73% to 51,324.69, while the CNX Nifty was down by 89.95 points or 0.59% to 15,118.95.

The US markets ended lower on Thursday following the release of a Labor Department report showing initial jobless claims came in well above street estimates in the week ended February 13th, with claims rising from a significantly upwardly revised level. The report said initial jobless claims edged up to 861,000, an increase of 13,000 from the previous week's revised level of 848,000. Street had expected jobless claims to dip to 765,000 from the 793,000 originally reported for the previous week. Meanwhile, the Commerce Department released a report showing housing starts pulled back by much more than expected in the month of January. The Commerce Department said housing starts tumbled by 6.0 percent to an annual rate of 1.580 million in January after soaring by 8.2 percent to an upwardly revised rate of 1.680 million in December. Street had expected housing stocks to decrease by 0.7 percent to a rate of 1.658 million from the 1.669 million originally reported for the previous month. The upwardly revised rate seen in December reflected the highest annual rate of housing starts since September of 2006. Besides, a negative reaction to earnings reports from Walmart contributed to sell-off on markets, with the retail giant plunging by 6.5 percent. The steep drop by Walmart came after the company reported weaker than expected fourth quarter earnings and warned of slowing sales growth in the coming year.

Crude oil futures ended lower on Thursday amid prospects of OPEC increasing crude production. Traders were betting on speculation that the Organization of the Petroleum Exporting Countries and allies may decide to increase crude output. The agency and its allies, collectively known as OPEC+, are scheduled to meet in the first week of March. Oil prices rose despite data showing another weekly decline in US crude stockpiles, and outages in Texas due to frigid temperatures. Data released by US Energy Information Administration (EIA) showed crude inventories declined by 7.258 million barrels last week (February 12), falling more than three times the expected decline. Distillate stockpiles were down 3.42 million barrels last week, more than twice the expected drop. Crude oil futures for March fell 62 cents or 1 percent to settle at $60.52 barrel on the New York Mercantile Exchange. April Brent crude declined 41 cents or 0.6 percent to settle at $63.93 a barrel on London's Intercontinental Exchange.

Erasing previous session losses, Indian rupee ended significantly higher against dollar on Thursday, on selling of the American currency by exporters. Traders took solace with S&P Global Ratings' latest report stating that India will be one of the fastest growing emerging market economies with a 10 percent growth in FY22, and future sovereign rating action would hinge on lowering fiscal deficit and sustaining debt burden. Additional support also came as Global forecasting firm Oxford Economics revised India's economic growth projection for 2021 to 10.2 per cent from the earlier 8.8 per cent, citing receding COVID-19 risks and the shift in the monetary policy outlook. However, lackluster trade in Indian equity markets capped rupee's gain. On the global front, pound edged higher against both the euro and the dollar on Thursday, reaching its highest in almost a year against the single currency, amid expectations of a faster economic recovery in Britain thanks to its successful COVID-19 vaccinations. Finally, the rupee ended at 72.65, 9 paise stronger from its previous close of 72.74 on Wednesday.

The FIIs as per Thursday's data were net buyer in equity segment, while net seller in debt segment. In equity segment, the gross buying was of Rs 8586.86 crore against gross selling of Rs 7396.35 crore, while in the debt segment, the gross purchase was of Rs 450.81 crore with gross sales of Rs 1411.12 crore. Besides, in the hybrid segment, the gross buying was of Rs 2.38 crore against gross selling of Rs 42.13 crore.

The US markets settled in red on Thursday as more discouraging data on jobless claims and higher bond yields gave investors little reason to keep pushing the market higher. Asian markets are trading lower on Friday following overnight declines for the major indexes on Wall Street. Indian markets ended over half a percent lower on Thursday, extending losses for the third straight session dragged mainly by banking, financial and auto stocks. Today, the markets are likely to make negative start of session amid weakness in global peers. Traders will be concerned with report that India registered 12,643 fresh Covid-19 cases of the coronavirus disease (Covid-19). Active cases in India stand at 137,866, while the caseload tally has risen to 10,962,189. The country continues to be second-most-affected globally, and ranks 17th among worst-hit nations by active cases. Also, there will be some cautiousness as the union ministries of health and civil aviation have released new guidelines for arriving international passengers due to the increased transmissibility of Brazil, South Africa, and UK variants of COVID-19. As per the new rules, all passengers traveling to India must get an RT-PCR test conducted within 72 hours of their flight departure time and the negative report has to be uploaded before boarding. However, some support may come later in the day with report that foreign portfolio investors (FPIs) have pumped in a whopping $33.8 billion into domestic equities and debt till February 15 this fiscal year -- the highest since FY15 when it was nearly $46 billion --taking their net outstanding investments to a record $592.5 billion. Meanwhile, Finance Minister Nirmala Sitharaman said India's inflation target band of 2%-6% is up for review as the five-year term for the current monetary policy framework draws to a close. Telecom sector stocks will be in focus with data released by sector regulator Trai showing that telecom subscriber base in the country fell marginally to 1,173 million in December 2020 with Vodafone Idea and state-run telecom firms BSNL and MTNL losing the bulk of their customers. There will be some reaction in aviation industry stocks with the monthly traffic data released by the aviation regulator, DGCA showing that India's domestic air passenger traffic declined around 40 per cent to 7.7 million in January 2021 over the year-ago period as the pandemic continues to hit air travel demand. IT industry stocks will be in limelight with a private report that the Indian information technology (IT) industry is expected to touch $300-350 billion in terms of revenue over the next five years.

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

Nifty Top volumes

• Bharti Airtel is planning to acquire 20 percent stake in its DTH arm Bharti Telemedia from an affiliate of Warburg Pincus for about Rs 3,126 crore. 
• IndusInd Bank has raised Rs 2021 crore of common equity capital through conversion of preferential warrants issued to the Promoter entities - IIHL and IL. 
• NTPC's Unit-2 of 800 MW capacity of Gadarwara Super Thermal Power Project has successfully completed trial operation, consequently included in the installed capacity of NTPC. 
• Power Grid Corporation of India has bagged two electricity transmission projects under tariff-based competitive bidding norms.