Bulls made a fantastic comeback on Dalal Street as Indian benchmark indices erased previous day losses and ended nearly three percent higher on Friday amid strength in global markets. Markets made an optimistic start and traded with traction throughout the day, as sentiments got a boost with Finance Minister Nirmala Sitharaman's statement that India's economic growth is likely to be robust at 8.9 percent in the current financial year, reflecting the country's strong resilience and speedy recovery. Sitharaman also expressed confidence that India will continue to achieve a high growth rate in the next financial year as well. Adding more optimism, RBI data showed that bank credit grew by 10.82 per cent to Rs 120.46 lakh crore and deposits by 9.71 per cent to Rs 166.95 lakh crore in the fortnight ended May 6, 2022. Key indices extended buying in last leg of trade as traders remained optimism with Lok Sabha Speaker Om Birla's statement that India is on its way to become a hub of export as there has been an extensive progress in various sectors including defence under the leadership of Prime Minister Narendra Modi in the country. He noted that there was need for skilled workforce in view of the emerging technology and their growing use in every sector. Meanwhile, NITI Aayog CEO Amitabh Kant has said it is the private sector's job to create wealth and the government should focus on laying down public policy framework. Finally, the BSE Sensex rose 1534.16 points or 2.91% to 54,326.39 and the CNX Nifty was up by 456.75 points or 2.89% to 16,266.15.

The US markets settled mostly higher on Friday with modest gains. Indices failed to hold early gains and trimmed some of their gains. Though, Nasdaq slipped below neutral line. The extended volatility on Wall Street came as traders continued to debate when the markets will reach a bottom following recent weakness. Light trading activity may also have contributed to the volatility, with a lack of major U.S. economic data keeping some traders on the sidelines following the release of a slew of data earlier in the week. Traders may also have been looking ahead to next week's reports on new home sales, durable goods orders, and personal income and spending as well as the minutes of the latest Federal Reserve meeting. On the sectoral front, computer hardware stocks climbed well off their worst levels but still ended the day notably lower, resulting in a 2.9 percent slump by the NYSE Arca Computer Hardware Index. Significant weakness also remained visible among airline stocks, as reflected by the 1.4 percent drop by the NYSE Arca Airline Index. On the other hand, pharmaceutical stocks moved sharply higher on the day, driving the NYSE Arca Pharmaceutical Index up by 2 percent. Healthcare stocks also turned in a strong performance, with the Dow Jones U.S. Health Care Index climbing by 1.2 percent.

Crude oil futures ended higher on Friday amid by the proposed ban on Russian oil by the EU and the relaxation of Covid lockdowns in China. Strong consumption and stockpiles data from the U.S. Energy Information Administration also added to gains in oil prices, while worries about a global economic slowdown capped oil's upside. The European Union expects to clinch a deal with member states to effect a ban of Russian crude imports. Benchmark crude oil futures for June delivery rose $0.39 or about 0.4% percent to settle at $110.28 a barrel on the New York Mercantile Exchange. Brent crude for July delivery surged $0.58 or 0.51 percent to settle at $112.62 a barrel on London's Intercontinental Exchange.

Declining for the third straight session, Indian rupee depreciated against dollar, on account of sustained dollar demand from importers and banks. Traders were worried despite Finance Minister Nirmala Sitharaman's statement that India's economic growth is likely to be robust at 8.9 percent in the current financial year, reflecting the country's strong resilience and speedy recovery. Sitharaman also expressed confidence that India will continue to achieve a high growth rate in the next financial year as well. On the global front, dollar was headed for its worst week since early February versus major peers on Friday, as some of the heat faded from the currency's breakneck 10% surge. Finally, the rupee ended at 77.63 (Provisional), weaker by 7 paise from its previous close of 77.56 on Thursday. The currency touched a high and low of 77.63 and 77.49 respectively.

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 6509.27 crore against gross selling of Rs 10352.10 crore, while in the debt segment, the gross purchase was of Rs 533.41 crore with gross sales of Rs 365.61 crore. Besides, in the hybrid segment, the gross buying was of Rs 0.53 crore against gross selling of Rs 3.61 crore.

The US markets ended mostly in green on Friday after a volatile session that saw Tesla slump and other growth stocks also lose ground. Asian markets are trading mixed on Monday as persistent worries about inflation and rising interest rates dog the global economic outlook. Indian markets rose sharply on Friday amid gains across sectors following two days of losses tracking mixed moves across global markets. Today, the markets are likely to make cautious start amid mixed global cues. Market participants will be concerned with report that the outflow of funds from domestic markets has continued as Foreign Portfolio Investors (FPI) remain net sellers. So far in the month of May, FPIs have pulled out Rs 37,216 crore as headwinds such as tighter monetary policy and rising inflation force investors towards safer havens. There will be some cautiousness as RBI data showed the country's foreign exchange reserves declined by $2.676 billion to stand at $593.279 billion in the week ended May 13. In the previous week, the reserves had declined by $1.774 billion to $595.954 billion. However, traders may take encouragement with the commerce and industry ministry's statement that total foreign direct investment into India rose 2 per cent to the highest ever $83.57 billion in 2021-22 on account of various measures like policy reforms and ease of doing business taken by the government. Some support may come with a private report that India Inc seems to be optimistic about opening of new vacancies amid steady hiring trends during the current financial year as the country's economy is on a growth trajectory. Meanwhile, the Indian government is considering spending an additional 2 trillion rupees ($26 billion) in the 2022/23 fiscal year to cushion consumers from rising prices and fight multi-year high inflation. There will be some buzz in the fertilizer industry stocks as to insulate farmers from the sharp increases in the prices, the Centre announced a doubling of fertiliser subsidy to Rs 2.15 trillion from the budgeted level for FY23. Metals stocks were in focus as the government has waived customs duty on the import of some raw materials, including coking coal and ferronickel, used by the steel industry, a move which will lower the cost for the domestic industry and reduce the prices. There will be some reaction in tea stocks as Saurav Pahari, chairman and deputy chairman, Tea Board said the plan is to achieve exports of 240 million kg in 2022-2023 and we are targeting 300 million kg by 2025.

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

Nifty Top volumes

• Dr. Reddy's Laboratories is planning to go to a regulator for its single-dose Sputnik Light jab as a booster dose for approvals by June-end or early July. 
• NTPC has started commercial operation of second part capacity of 35 MW out of 92 MW Kayamkulam Floating Solar PV Project at Kayamkulam, Kerala. 
• HDFC Life Insurance Company has set an ambitious target of more than doubling its embedded value to Rs 60,000 crore in the next five years, buoyed by a similar feat achieved during the past five years. 
• Bajaj Finserv's subsidiary company -- Bajaj Allianz Life Insurance has declared a bonus of Rs 1,070 crore for its policyholders in the fiscal ended March 2022.