Indian equity benchmarks made a strong comeback on Monday after three days of losses, due to strong momentum in global markets, favourable domestic economic data and good Q2 results announcement. After opening in the green, benchmark indices continued to gain momentum. Traders took encouragement as the Reserve Bank of India (RBI) said that retail -- covering housing and vehicles, credit cards, etc -- showed an accelerated growth rate of 12.1 per cent in September 2021 against 8.4 per cent in September 2020. Sentiments remained positive with a private survey stating that manufacturing activity in India gained steam in October as companies scaled up production in line with a substantial upturn in new work intakes. Similarly, factory output increased at a sharp pace that was the strongest since March. At 55.9 in October, vs 53.7 in September, the seasonally adjusted IHS Markit India Manufacturing Purchasing Managers' Index was in expansion territory for the fourth month in a row in October, pointing to the strongest improvement in overall operating conditions since February. Traders remained energized after the finance ministry stating that Goods and Services Tax (GST) collection remained above Rs 1 lakh crore for the fourth month in a row at over Rs 1.30 lakh crore in October, indicating the impact of festive buying. This is the second highest collection of GST since its implementation on July 1, 2017. The tax collections last month on goods sold and services rendered was 24 per cent higher than in October 2020. Additional support also came with data showing that the growth of eight core infrastructure industries grew by 4.4 percent in September 2021 as compared to same month last year on account of healthy performance by segments like natural gas, refinery products and cement. Though, it fell as compared to 11.5 per cent in the previous month. Meanwhile, government data showed India's federal fiscal deficit during April-September, the first half of the current fiscal year, stood at 5.27 trillion rupees ($70.4 billion) or 35% of the budgeted target for the whole year. Finally, the BSE Sensex rose 831.53 points or 1.40% to 60,138.46 and the CNX Nifty was up by 258.00 points or 1.46% to 17,929.65.

The US markets ended higher on Monday with Dow Jones Industrial Average and S&P 500 closing at record highs. A batch of upbeat earnings news has contributed to a recent upward trend, as most major companies have reported better than expected quarterly results. Tesla, which became a $1 trillion company last week, continued its gains for the year with shares up nearly 8.5%. Stocks linked to an economic recovery, such as Ford and Occidental Petroleum, were also higher. Ford gained 5% and Occidental Petroleum popped 3.8%. However, upside remained capped as traders looked ahead to the Federal Reserve's monetary policy announcement on Wednesday. The Fed is likely to leave interest rates unchanged but could announce plans to begin scaling back its asset purchase program. On the economic data front, a report released by the Institute for Supply Management (ISM) showed a modest slowdown in the pace of growth in US manufacturing activity in the month of October. The ISM said its manufacturing index edged down to 60.8 in October from 61.1 in September, although a reading above 50 still indicates growth. Street had expected the index to dip to 60.5. Meanwhile, the Commerce Department released a report showing construction spending in the US unexpectedly decreased in the month of September. The report said construction spending fell by 0.5 percent to an annual rate of $1.574 trillion in September after inching up by 0.1 percent to a revised rate of $1.582 trillion in August. The drop in construction spending came as a surprise to participants, who had expected spending to increase by 0.4 percent.

Crude oil futures ended higher on Monday as investors expect the Organization of the Petroleum Exporting Countries and their allies (OPEC+) to remain reluctant to accelerate production increases despite tightening crude supplies. The Biden administration has called on OPEC+ to boost output, but producers have remained reluctant. OPEC+ has so far stuck to a plan to boost output in monthly increments of 400,000 barrels a day, but members have struggled to hit that goal. Oil prices climbed despite report that China has released reserves of gasoline and diesel to boost supply and help stabilize prices in some regions. Benchmark crude oil futures for December delivery rose 48 cents or about 0.6% to settle at $84.05 a barrel on the New York Mercantile Exchange. Brent crude for January delivery surged 99 cents or 1.2 percent to settle at $84.71 a barrel on London's Intercontinental Exchange.

Indian rupee ended marginally higher against dollar on Monday, on selling of the American currency by exporters. Traders remained positive as growth of eight core infrastructure industries grew by 4.4 percent in September 2021 as compared to same month last year on account of healthy performance by segments like natural gas, refinery products and cement. On the global front; dollar consolidated gains against its rivals on Monday, after posting its biggest daily rise in more than four months as hedge funds cut back bearish bets ahead of a U.S. Federal Reserve policy meeting this week. Finally, the rupee ended 74.87, stronger by 1 paise from its previous close of 74.88 on Friday.

The FIIs as per Monday's data were net seller in equity segment, while net buyer in debt segment. In equity segment, the gross buying was of Rs 7028.61 crore against gross selling of Rs 12504.98 crore, while in the debt segment, the gross purchase was of Rs 652.15 crore with gross sales of Rs 441.58 crore. Besides, in the hybrid segment, the gross buying was of Rs 12.65 crore against gross selling of Rs 14.85 crore.

The US markets ended higher on Monday as Tesla shares surged and the energy sector gained while investors looked ahead to a major Federal Reserve meeting later in the week. Asian markets are trading mostly in green on Tuesday as investors awaited several key central bank meetings that could set the tone for risk appetite heading into next year. Indian markets closed in green to snap a three-day losing streak on Monday as broad-based gains led by financial, IT, metal and consumer goods shares pushed the headline indices higher. Today, markets are likely to start on a positive note amid positive global cues. Sentiments will get a boost as provisional data released by the government showed that India's merchandise exports in October rose 42.33 per cent to $35.47 billion. The exports stood at $24.92 billion in October 2020 and $26.23 billion in October 2019. The merchandise imports surged 62.49 per cent to $55.37 billion from $34.07 billion in October 2020. It was $37.99 billion in October 2019. As per the data, the trade deficit in October 2021 was $19.9 billion and $98.71 billion during April-October 2021. Some support will also come as Goods and Services Tax (GST) collection remained above Rs 1 lakh crore for the fourth month in a row at over Rs 1.30 lakh crore in October, indicating the impact of festive buying. This is the second highest collection of GST since its implementation on July 1, 2017. Traders may take note of SBI Research report stating that the digitisation drive and pandemic-induced emergence of the gig economy have led to a faster formalisation of the economy, with the share of the informal sector shrinking to just 15-20 per cent in 2021 from 52.4 per cent in 2018. However, there may be some cautiousness with Centre for Monitoring of Indian Economy (CMIE) data showing that despite a 124 basis points month-on-month decline in urban joblessness rate, the country's overall unemployment rate rose again in October, owing to a sudden 175 basis points rise in rural joblessness rate. There will be some reaction in edible oils industry stocks as amid no sign of further moderation in edible oil prices, industry body SEA said its members have decided to further reduce the wholesale prices of edible oils by Rs 3-5 per kg during this festival season to provide relief to consumers.

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

Nifty Top volumes

• JSW Steel's subsidiary -- JSW Steel (USA) Inc. has commenced the second phase of the project to upgrade its Plate Mill facility located at Baytown in Texas, USA. 
• BPCL is planning to raise up to Rs 3,000 crore during the current financial year 2021-22 through private placement of unsecured non-convertible debentures subject to market conditions. 
• Sun Pharmaceutical Industries has launched Winlevi cream in US market. Winlevi cream used for the treatment of acne vulgaris in patients 12 years and older. 
• Bharti Airtel has rolled out 5GforBusiness initiative to demonstrate a wide range of enterprise grade use cases using high speed & low latency networks.