Indian equity benchmarks settled in red for the fourth straight day on Friday, dragged by losses in index heavyweights like Bajaj Finserv, Maruti Suzuki and Bharti Airtel amid weakness across global markets. After opening in the red, benchmark indices slipped further lower, as traders were concerned with former RBI Governor D Subbarao stressed on the need to accelerate India's economic growth rate and make sure that this benefit of growth is shared, even as he said that unemployment has taken a form of crisis in the country. Subbarao further said the organised sector is shedding jobs and the labour force is moving from high productive sector to the unorganised sector. Traders also took a note of the RBI report stating that India's external debt stood at $571.3 billion at end-June, recording an increase of $1.6 billion over its level at the end of March 2021. However, the external debt to GDP ratio declined to 20.2 percent at June-end 2021 from 21.1 percent as of March 31. Valuation gain due to the appreciation of the US dollar vis-a-vis the Indian rupee was at $1.7 billion. Markets continued to trade on a negative note in late afternoon deals even as private survey stating that India's manufacturing activity recovered slightly in September, from a slowdown in growth in the previous month of August as strengthening demand conditions amid the easing of COVID-19 restrictions boosted sales. According to the monthly IHS Markit India Manufacturing Purchasing Managers' Index (PMI) survey, manufacturing PMI stood at 53.7 in September, up from 52.3 in August. Market participants also paid no heed towards veteran banker KV Kamath's statement that the country's economy is set for a stronger performance going forward, driven by growth in large corporates, agriculture and most importantly digital startup sector. Meanwhile, the Controller General of Accounts (CGA) in its latest data has said that the government's fiscal deficit stood at Rs 4.68 lakh crore or 31.1 per cent of the Budget estimates at the end of August 2021. The deficit figure in the current fiscal appears much better than the previous financial year when it had soared to 109.3 per cent of the estimates, mainly on account of a jump in expenditure to deal with the COVID-19 pandemic. Finally, the BSE Sensex fell 360.78 points or 0.61% to 58,765.58 and the CNX Nifty was down by 86.10 points or 0.49% to 17,532.05.

The US markets ended volatile session sharply higher on Friday as traders' desire to go bargain hunting seemed to win out over concerns about inflation and the Federal Reserve scaling back its asset purchases. With the rally, the major averages regained ground following the steep drop seen in the previous session. On the economic data front, a report from the Institute for Supply Management showed an unexpected acceleration in the pace of growth in U.S. manufacturing activity but noted persistent supply chain issues. The ISM said manufacturing PMI crept up to 61.1 in September from 59.9 in August, with a reading above 50 indicating growth in the manufacturing sector. The uptick surprised participants, who had expected the index to edge down to 59.6. Timothy R. Fiore, Chair of the ISM Manufacturing Business Survey Committee said Manufacturing performed well for the 16th straight month, with demand, consumption and inputs registering month-over-month growth, in spite of continuing unprecedented obstacles and ever-increasing demand. He added Panelists' companies and their supply chains continue to struggle to meet demand due to difficulties in hiring and a clear cycle of labor turnover, as workers opt for more attractive job opportunities. On the sectoral front, airline stocks showed a substantial move to the upside on the day. Significant strength was also visible among energy stocks, which moved higher along with the price of crude oil. Financial, chemical, and software stocks also saw considerable strength on the day, moving higher along with most of the other major sectors.

Crude oil futures settled higher on Friday as traders weighed possible outcomes for Monday's expected decision by Organization of the Petroleum Exporting Countries (OPEC) and its allies on crude production levels. It is widely expected that the cartel may go beyond its existing deal to boost production by 400,000 barrels per day (bpd) in November and December. According to a report from Baker Hughes, the oil and gas rig count rose by seven to 528 in the week to October 1, its highest since April 2020. The total rig count was up 262 rigs, or 98%, over this time last year. The report said, drillers have added rigs for 14 straight months now. U.S. oil rigs rose seven to 428 this week, while gas rigs were steady at 99. Benchmark Crude oil futures for November delivery rose 85 cents or 1.1 percent to settle at $75.88 barrel on the New York Mercantile Exchange. Brent crude for December delivery added 97 cents or 1.2 percent to settle at $79.28 a barrel on London's Intercontinental Exchange.       

Erasing previous session drubbing, Indian rupee ended considerably stronger against dollar on Friday due to fresh selling of the American currency by banks and exporters. Sentiments got support as growth of eight core infrastructure industries grew by 11.6 percent in August 2021 as compared to same month last year mainly due to an uptick in the production of cement, coal, and natural gas. Additional support came in as Nikkei India Manufacturing Purchasing Managers' Index (PMI) - a composite single-figure indicator of manufacturing performance - stood at 53.7 in September as against 52.3 in August. On the global front, sterling was set on Friday for its third-worst week in the past year as risk sentiment soured across global financial markets while a shortage of truck drivers and a surge in energy prices disrupt and blacken the prospects of Britain's economy. Finally, the rupee ended 74.12, stronger by 11 paise from its previous close of 74.23 on Thursday.

The FIIs as per Friday's data were net sellers in equity and debt segment both. In equity segment, the gross buying was of Rs 11093.19 crore against gross selling of Rs 13085.56 crore, while in the debt segment, the gross purchase was of Rs 1207.60 crore with gross sales of Rs 1453.18 crore. Besides, in the hybrid segment, the gross buying was of Rs 12.71 crore against gross selling of Rs 30.83 crore.

The US markets ended higher on Friday as investors shook off a rough September and reports of a new oral treatment for Covid-19 boosted shares of companies tied to the economic recovery. Asian markets are trading mostly higher in early deals on Monday following positive cues from US markets. Indian equity benchmarks ended lower on Friday as India's external debt stood at USD 571.3 billion at end-June, recording an increase of USD 1.6 billion over its level at the end of March 2021. Today, markets are likely to make positive start on firm global cues. Traders will get encouragement as former Niti Aayog vice-chairman Arvind Panagariya said the fundamentals of the Indian economy are sound as the real GDP in Q3 and Q4 of FY21 already crossed the pre-pandemic level. Some support may also come as Minister of Commerce & Industry, Consumer Affairs, Food & Public Distribution and Textiles, Government of India, Piyush Goyal said at a time when the whole world is coming together to recover from the pandemic and bring growth back on track, a resurgent India is ready to take on the responsibility of being the frontrunner in this revival process. Meanwhile, terming Insolvency and Bankruptcy Code as a seminal reform, Chief Economic Adviser KV Subramanian said it has been instrumental in changing the mindset of promoters of businesses by making them more accountable. However, there may be some cautiousness as trade deficit spiked to almost $23 billion in September from $13.8 billion in the previous month, as imports surged at a much faster pace than exports, driven by elevated global crude oil prices and massive purchases of gold in the build-up to the festival season. With crude oil prices hovering around 3-year highs, petroleum imports may continue to surge in the coming months. This will pressure trade and current account deficits, which have remained well under control in the aftermath of the pandemic. There will be some buzz in sugar sector's stocks as Food Secretary Sudhanshu Pandey said sugar industry should now look beyond its immediate blending target of 2025 and focus on newer technologies as the journey of ethanol blending has just started.

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

Nifty Top volumes

•  HDFC Bank has raised Rs 739 crore by issuing the rupee-denominated masala bonds in the overseas markets.
•  NTPC's arm NTPC Renewable Energy has signed its first Green Term Loan agreement of Rs 500 crore at a very competitive rate with a tenor of 15 years with Bank of India.  
•  Maruti Suzuki India has launched a virtual car assistant app called S-Assist based on artificial intelligence to help in post-purchase experience to customers.
•  Coal India is planning to fund a mock-up coal mine at National Science Centre Delhi, a unit of National Council of Science Museums.