Indian equity benchmarks ended trading session with modest losses amid lacklustre moves post the Budget FY25 proposals announced by finance minister Nirmala Sitharaman. Markets made a positive start, as traders took support with provisional data from the NSE showing that foreign institutional investors (FIIs) net bought shares worth Rs 1,660.72 crore on January 31. Some optimism also came as Goods and services tax (GST) collections hit the second highest monthly figure ever at over Rs 1.72 trillion in January, growing by 10.4 per cent over Rs 1.56 trillion from the same month in the previous year. These GST figures were till 5 pm of January 31, and final collection for the month would be higher. However, volatility struck over the bourses in late morning deals, as markets erased all of their initial gains and turned negative to settle with marginal losses. Traders got anxious with data showing that India's core sector output growth hit a 14-month low of 3.8 per cent year-on-year in December on the back of a high base and a moderation in the growth of six constituent sectors. Traders failed to draw any sense of relief from interim budget 2024-25. Finance Minister Nirmala Sitharaman kept Income Tax rates unchanged in the Interim Budget. Besides, Finance Minister increased the infrastructure capital expenditure in the interim budget for FY 2025 by 11.1% to Rs 11.1 lakh crore. The budget also witnessed biggest sectoral allocation awarded to Defence at Rs 6.2 lakh crore. In 2023 budget, the sector received nearly Rs 6 lakh crore. Traders also overlooked India's final manufacturing PMI showing that manufacturing activity accelerated in January. The seasonally adjusted HSBC India Manufacturing Purchasing Managers' Index (PMI) recovered from an 18-month low of 54.9 in December to 56.5 in January.  Finally, the BSE Sensex fell 106.81 points or 0.15% to 71,645.30 and the CNX Nifty was down by 28.25 points or 0.13% to 21,697.45.

The US markets ended higher on Thursday as some traders saw the sell-off on Wednesday as a buying opportunity amid optimism the markets will resume the upward trend seen throughout much of January. A continued decrease by treasury yields have also contributed to the buying interest, with the yield on the benchmark ten-year note falling to its lowest levels in over a month. On the sectoral front, Gold stocks showed a substantial move to the upside on the day, driving the NYSE Arca Gold Bugs Index up by 3.8 percent. The rally by gold stocks came amid a modest increase by the price of the precious metal, with gold for April delivery inching up $3.70 to $2,071.10 an ounce. Considerable strength was also visible among computer hardware stocks, as reflected by the 2.7 percent gain posted by the NYSE Arca Computer Hardware Index. On the economic data front, the Labor Department released a report showing first-time claims for U.S. unemployment benefits unexpectedly saw a modest increase in the week ended January 27th. The Labor Department said initial jobless claims rose to 224,000, an increase of 9,000 from the previous week's revised level of 215,000. Street had expected jobless claims to edge down to 212,000 from the 214,000 originally reported for the previous week. Meanwhile, a reading on U.S. manufacturing activity unexpectedly increased in the month of January but continues to indicate contraction, according to a report released by the Institute for Supply Management. The ISM said its manufacturing PMI rose to 49.1 in January from a downwardly revised 47.1 in December. While a reading below 50 still indicates contraction, street had expected the index to edge down to 47.0 from the 47.4 originally reported for the previous month.

Crude oil futures ended deeply lower on Thursday with traders following the developments regarding negotiations of a cease-fire in the Israel-Hamas war. Meanwhile, EIA said in a report that global oil demand will likely increase by 2 million barrels per day in 2024, substantially higher than a previous forecast of a rise of 1.24 million bpd. Benchmark crude oil futures for March delivery dropped $2.03 or 2.7% to settle at $73.82 a barrel on the New York Mercantile Exchange. Brent crude for March delivery fell $1.85 or 2.3% to $78.70 per barrel on London's Intercontinental Exchange.  

Indian rupee appreciated against the US dollar on Thursday amid interim Budget. Traders got encouragement as India's final manufacturing PMI showed that manufacturing activity accelerated in January. The seasonally adjusted HSBC India Manufacturing Purchasing Managers' Index (PMI) recovered from an 18-month low of 54.9 in December to 56.5 in January. Besides, goods and services tax (GST) collections hit the second highest monthly figure ever at over Rs 1.72 trillion in January, growing by 10.4 per cent over Rs 1.56 trillion from the same month in the previous year. These GST figures were till 5 pm of January 31, and final collection for the month would be higher.  On the global front, the euro hit a seven-week low on Thursday as the dollar rose after Federal Reserve Chair Jerome Powell pushed back against bets of a U.S. rate cut as soon as March, and as traders processed market jitters about U.S. regional lenders. Finally, the rupee ended at 82.97 (Provisional), stronger by 7 paise from its previous close of 83.04 on Wednesday.

The FIIs as per Thursday's data were net buyers in both equity and debt segments. In equity segment, the gross buying was of Rs 25952.76 crore against gross selling of Rs 24212.61 crore, while in the debt segment, the gross purchase was of Rs 3363.41 crore with gross sales of Rs 770.82 crore. Besides, in the hybrid segment, the gross buying was of Rs 47.09 crore against gross selling of Rs 31.82 crore.

The US markets ended higher on Thursday as traders shifted their focus from a likely lack of rate cut in March to corporate earnings. Asian markets are trading in green on Friday following the broadly positive cues from Wall Street overnight. Indian markets ended with minor losses on Thursday after Finance Minister Nirmala Sitharaman presented the inline Interim Budget with no big announcements. Today, start of the session is likely to be optimistic mirroring firm cues from Wall Street overnight as well as higher opening in Asian counterparts. Fall in the 10-year US Treasury bond yield also likely to aid domestic sentiments. Overnight sharp fall in crude oil prices may support Indian markets. Sentiments will get a boost as Commerce and Industry Minister Piyush Goyal said India has sustained its export growth notwithstanding the global challenges emerging due to issues like the Israel-Hamas war and the Budget has laid out a strong foundation to push the economic growth. Some support will come as Managing Director of International Monetary Fund (IMF) Kristalina Georgieva said that the economic success of India is grounded in the pursuit of reforms over the last years and exuded confidence that it would achieve its goal of being a developed nation by 2047 by staying the course. There will be some buzz in automobile industry stocks with a private report that the Indian auto industry posted its highest ever monthly domestic passenger vehicle (PV) wholesales in January 2024 at 394,571 units, on the back of rising demand for sport utility vehicles (SUVs) and removal of supply constraints. Insurance industry stocks will be in focus as the insurance regulator asked general insurers to put Ayurveda, Yoga, Naturopathy, Unani, Siddha, and Homeopathy (AYUSH) at par with other medical treatments in their health insurance policies, citing increased popularity. There will be some reaction in dairy and fisheries sectors stocks after Finance Minister Nirmala Sitharaman announced the dairy sector will soon get a comprehensive programme to boost milk production, while implementation of the Pradhan Mantri Matsya Sampada Yojana (PMMSY) will be stepped up to benefit the fisheries sector. Meanwhile, individual stocks - Bank of India, Delhivery, IndiGo, LIC Housing Finance, Medplus Health Services, Mahindra Holidays, NIIT, RateGain Travel Technologies, Sundaram Fasteners, Tata Motors, Titagarh Rail Systems, Torrent Pharma, TTK Healthcare, UPL and Whirlpool are likely to be in focus as these companies announce Q3 results today.

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

Nifty Top volumes

• Tech Mahindra has entered into a strategic partnership with Competera, headquartered in the US. Competera is a pioneer in AI-powered pricing technologies that enables retailers to set and maintain optimal pricing in real-time.
• Bajaj Auto is developing a portfolio of CNG motorcycles, and the first such bike will hit the market next fiscal (FY25) under a new brand.
• Adani Ports and Special Economic Zone has reported 65.22% rise in its consolidated net profit at Rs 2,208.21 crore for Q3FY24 as compared to Rs 1,336.51 crore for the same quarter in the previous year.
• Mahindra & Mahindra has reported a 15 per cent growth in total automotive sales at 73,944 units in January 2024, as compared to the same month a year ago.