Indian equity benchmarks erased all of their gains to end the last trading day of 2022 on a bearish note due to fag-end selling amid weak cues from the European markets. The indices made a positive start, as traders took encouragement with Reserve Bank of India (RBI) Governor Shaktikanta Das' statement that the Indian economy is resilient with financial stability maintained with a well-capitalised banking sector, amid global uncertainties and shocks. Some support also came in as Union Commerce Minister Piyush Goyal said he expects at least two more free trade agreements to be signed up in 2023. He said negotiations are scheduled with the UK, European Union and Canada.  Sentiments remained optimistic with report stating that after remaining above the Reserve Bank's comfort level of 6 per cent for most part of this year, retail inflation is slowly easing, and efforts are likely to continue to further reduce it in the coming months amid global uncertainties. However, a sharp cut in the last half an hour pushed the bulls on the back foot. Traders also turned cautious as data released by the Reserve Bank showed that the country's current account deficit widened to 4.4 per cent of the GDP in the quarter ended September, from 2.2 per cent of GDP during the April-June period, due to higher trade gap. Some anxiety also came with private report stating that the wave of consolidation is likely to hit the shores of the country's fast-growing retail industry next year also as larger players seek to strengthen their footprints, leverage technologies to improve efficiency and expand beyond metros. Meanwhile, the finance ministry said that India's external debt stood at $610.5 billion in the second quarter of 2022-23, down by $2.3 billion from end-June 2022. The external debt to GDP ratio stood at 19.2 per cent as at end-September 2022 as compared to 19.3 per cent at end-June. Finally, the BSE Sensex fell 293.14 points or 0.48% to 60,840.74 and the CNX Nifty was down by 85.70 points or 0.47% to 18,105.30.

The US markets ended lower on Friday but staged a notable recovery attempt going into the close. Initially, markets were down as some traders looked to cash in on Thursday's strong gains, which largely reflected a substantial rebound by technology stocks. Lingering concerns about the economic outlook also continued to weigh on Wall Street amid worries further interest rate hikes will lead to a recession in the New Year. The late-day recovery attempt may have reflected window-dressing going into the end of the year. On the economic data front, a report released by MNI Indicators showed a bigger than expected slowdown in the pace of contraction in Chicago-area business activity in the month of December. MNI Indicators said its Chicago business barometer climbed to 44.9 in December from 37.2 in November, although a reading below 50 still indicates a contraction. Street had expected the index to rise to 41.2. The bigger than expected rebound came after the Chicago business barometer fell to its lowest reading since the 2008/09 global financial crisis, excluding the 2020 pandemic shock. On the sectoral front, Most of the major sectors ended the day showing only modest moves, although notable weakness remained visible among utilities stocks, with the Dow Jones Utilities Average falling by 1.1 percent. Commercial real estate, transportation and chemical stocks also moved to the downside on the day, while some strength emerged among energy stocks.

Crude oil futures ended significantly higher on Friday, the last trading session of 2022, as the dollar dropped to a more than 6-month low. Some optimism also came in amid hopes of increased demand for fuel from China after the country abruptly ended its Covid restrictions.. Besides, recent reports about Russia's Deputy Prime Minister Alexander Novak saying that Russia may cut production by 500,000 - 700,000 barrels per day, added to the up move of oil prices. According to a report from Baker Hughes, the total rig count in the U.S. stayed at 779 this week. That is 193 rigs higher than the rig count this time in 2021, and 296 rigs lower than the count before the pandemic. Benchmark crude oil futures for February delivery rose $1.86 or 2.4 percent at $80.26 a barrel on the New York Mercantile Exchange. Brent crude for March was almost flat at $83.46 a barrel on London's Intercontinental Exchange.

Indian rupee settled higher against dollar on last trading session of 2022 as the American currency retreated from its elevated levels and a rising appetite for riskier assets among investors. Sentiments were upbeat with report stating that after remaining above the Reserve Bank's comfort level of 6 per cent for most part of this year, retail inflation is slowly easing, and efforts are likely to continue to further reduce it in the coming months amid global uncertainties. On the global front, Russian rouble strengthened sharply on Friday, nearing the 70 mark against the dollar as a highly volatile year drew to a close, with the final month of trading dominated by fears over the impact of a Western oil price cap on Russia's export revenues. Finally, the rupee ended at 82.73 (Provisional), stronger by 14 paise from its previous close of 82.87 on Thursday.

The FIIs as per Friday's data were net buyers in equity segment, while net sellers in debt segment. In equity segment, the gross buying was of Rs 5568.75 crore against gross selling of Rs 5099.91 crore, while in the debt segment, the gross purchase was of Rs 268.36 crore against gross selling of Rs 699.04 crore. Besides, in the hybrid segment, the gross buying was of Rs 12.20 crore against gross selling of Rs 16.09 crore.

The US markets ended lower on Friday as some traders looked to cash in on Thursday's strong gains, which largely reflected a substantial rebound by technology stocks. Asian markets were trading mixed on Monday. The South Korean stock market index Kospi Composite traded with gains in the first session of 2023, while major Japanese and Chinese markets remain closed for the holidays.  Indian equity benchmarks lost their ground in last leg of trade and ended last trading day of 2022 in red terrain. Markets are likely to make negative start on first trading day of 2023. Traders may be cautious as the Finance Ministry's latest data showed that the government's fiscal deficit has touched 59 per cent of the full year Budget Estimate at November-end on increased capital expenditure and slow growth in non-tax revenue. However, some respite may come later in the day as the Finance Ministry has said that the GST collections for December 2022 stood at Rs 1,49,507 crore -- 2.5 per cent more than Rs 1,45,867 crore collected in November 2022. On year-on-year basis, GST revenue collected for December 2022 was 15 per cent higher than collections of December 2021, which was Rs 1,29,780 crore. Monthly GST revenues more than Rs 1.4 lakh crore for 10 straight months in a row. Some support may also come in on reports that corporate tax collections exceeded 3 per cent of the GDP after a gap of two years in 2021-22, reflecting overall improvement in profitability of India Inc propelled by increase in demand for goods and services. Traders may take note on report that IT Minister Rajeev Chandrasekhar has said India's digital prowess will grow in 2023 and over the next five years, driven by technology, start ups, semiconductors, electronics and computing. There may be some buzz in coal related stocks as the country is expected to produce 997.14 million tonnes (MT) of coal in the coming financial year. During 2024-25, the country is expected to produce 1,111.60 MT of coal, which includes 850 MT by Coal India Ltd (CIL), 181.60 MT by captive and others and 80 MT by SCCL. While in FY'26 India's production is expected at 1,288.39 MT, in FY'27 the figure is likely to reach 1,342.80 MT. There may be some reaction in Oil and gas industry related stocks as India's petrol and diesel demand soared in December as increased consumption in agriculture sector helped build on the momentum generated by the festive season. Petrol sales soared 8.6 per cent to 2.76 million tonnes in December, as compared to 2.54 million tonnes of consumption in the same month last year.

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

Nifty Top volumes

• Cipla's wholly-owned UK subsidiary, Cipla (EU) has signed definitive agreements for equity investment of EUR 15 million in Ethris GmbH.
•  Reliance Industries' telecom arm -- Reliance Jio Infocomm has launched its True 5G services in Indore and Bhopal.
•  NTPC has started commercial operation of first part capacity of 10 MW out of 23 MW Solapur Solar PV Project at Maharashtra, with effect from December 30, 2022.
•  HDFC has offloaded 1,90,11,237 equity shares representing 2.18% of the paid-up share capital of Siti Networks.