Indian equity benchmarks surged for the third straight session on Thursday, led by gains in energy, banking and finance stocks amid positive global cues. The benchmarks staged a gap up opening, as sentiments got a boost with Union Minister of State for Finance and Corporate Affairs Anurag Thakur's statement that India will have a strong economic revival thanks to its well-planned easing of lockdown. He also defended the contentious farm sector reforms, saying the Narendra Modi government had the courage to do what others could not. Sentiments remained up-beat with Secretary in the Department for Promotion of Industry and Internal Trade (DPIIT) Guruprasad Mohapatra's statement that the high growth story of foreign direct investments into India will go well in the new year too as there is a growing interest among overseas investors about the country amid the government's continuing reform measures to further improve the business climate. However, frontline indices trimmed some of their gains in late morning session but regained traction to end higher, taking support from Crisil Ratings' report that with extensive recovery efforts by non-banking financial companies (NBFCs) and uptick in economic activity, the collection efficiency ratios of its rated securitised pools for November 2020 payouts have improved to near pre-COVID-19 pandemic levels for most of the asset classes. Some support also came as the Reserve bank of India (RBI) Governor Shaktikanta Das asked banks to take proactive measures to strengthen their resilience and lending capacity by raising capital, with an aim to support the ongoing revival in economic activities. Adding to the optimism, describing India as an attractive investment destination for the energy sector, Union Minister of Petroleum and Natural Gas & Steel Dharmendra Pradhan has said that several policy reforms have enhanced the ease-of-doing-business. Finally, the BSE Sensex rose 529.36 points or 1.14% to 46,973.54, while the CNX Nifty was up by 148.15 points or 1.09% to 13,749.25.

The US markets were closed on Friday on account of Christmas.  

Indian rupee ended substantially higher against dollar on Thursday as banks and exporters continued to sell the US currency amid persistent capital inflows. This is the second consecutive session when the rupee is traded higher against dollar. Sentiments were upbeat with Secretary in the Department for Promotion of Industry and Internal Trade (DPIIT) Guruprasad Mohapatra's statement that the high growth story of foreign direct investments into India will go well in the new year too as there is a growing interest among overseas investors about the country amid the government's continuing reform measures to further improve the business climate. On the global front; pound extended gains on Thursday as Britain and the European Union appeared on the cusp of striking a trade deal, raising hopes the United Kingdom can avoid a turbulent economic departure at the end of the year. Finally, the rupee ended at 73.55, 21 paise stronger from its previous close of 73.76 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 5377.64 crore against gross selling of Rs 4678.18 crore, while in the debt segment, the gross purchase was of Rs 1362.19 crore with gross sales of Rs 2425.67 crore. Besides, in the hybrid segment, the gross buying was of Rs 50.79 crore against gross selling of Rs 76.32 crore.

The US markets remained closed on Friday on account of Christmas holiday. Asian markets are trading higher on Monday as a source said U.S. President Donald Trump signed into law a $2.3 trillion pandemic aid and spending package he had until now refused to sign. Also, China's industrial profits rose in November. Indian markets ended holiday shortened week sharply higher on Thursday to close near record highs, with heavyweight Reliance Industries and financials leading the surge on the back of positive global cues and sustained foreign fund inflows. Markets remained closed on Friday for the Christmas holiday. Today, the start of new week is likely to be positive tracking gains in Asian peers.  Traders will be taking encouragement with an article on the state of economy in the RBI Bulletin stating that the economy is coming out of the COVID-19 pandemic's deep abyss faster than most of the predictions, and the growth will enter positive zone in the third quarter of the current financial year. Some support will come with the Centre for Economics and Business Research's (CEBR) report that India, which appears to have been pushed back to being the world's sixth biggest economy in 2020, will again overtake the UK to become the fifth largest in 2025 and race to the third spot by 2030. Also, India Ratings has revised its projections for economic contraction to 7.8 per cent for 2020-21 from the earlier expectation of 11.8 per cent due to easing Covid-19 headwinds and better than expected numbers in the second quarter of the current financial year. Market participants may take note of report that the government has planned for a dry run of Covid-19 vaccine in four states - Andhra Pradesh, Assam, Gujarat, and Punjab - which will take place between December 28-29, ahead of actual implementation whenever the drug gets finalised. However, trader may be concerned with 20,333 fresh Covid-19 cases, India's caseload now stands at 10,208,725. The country's death toll has mounted to 147,940.  There may be some concern with RBI data showing that demand conditions in the manufacturing sector returned to the recovery mode with a softer contraction of 4.3 per cent (Y-o-Y) in the second quarter of this fiscal in terms of nominal sales after shrinking 41.1 per cent in the previous quarter that was hit by countrywide lockdowns due to COVID-19. There will be some buzz in telecom industry stocks with a private report that the telecom industry's active subscriber base rose by nearly 2.5 million in October 2020 to touch about 961 million, and user additions benefited from vanishing impact of SIM consolidation triggered from tariff hike. Auto stocks will be in focus with the Society of Indian Automobile Manufacturers' (SIAM) statement that automakers in India are bracing for a parts shortage and possible production losses over the next three to four months due to a global shortage of available shipping containers. There will be some reaction in infra  stocks with a government report showing that as many as 442 infrastructure projects, each worth Rs 150 crore or more, have been hit by cost overruns of over Rs 4.34 lakh crore.

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

Nifty Top volumes

• HDFC has signed a pact with the IGBC with this company's green housing retail loan book has crossed the Rs 14,000-crore-mark across 310 certified green buildings. 
• Reliance Industries' telecom arm -- Reliance Jio Infocomm has added 22,28,362 customers in October 2020. 
• Indian Oil Corporation is inviting bids to procure 15 Polymer Electrolyte Membrane fuel cell buses. 
• Bharti Airtel has added 36,74,243 customers in October 2020.