Indian equity benchmarks exhibited mixed trends in highly volatile trade on Thursday as investors remained wary of the deep selloff in Adani Group stocks, despite an overall positive Budget 2023 tone. Markets made a negative start and were trading in red for most part of the day as traders got anxious with Moody's Investors Service stating that the Indian federal government's aim to achieve a fiscal deficit target of 4.5% of gross domestic product (GDP) by 2025/26 could see some risks. The current pattern suggests that perhaps there could be some upward pressure on expenditure especially if they (government) continue with this focus on capex. Traders also remained cautious with a private report stating that the country's fast-moving consumer goods (FMCG) industry witnessed a consumption slowdown in the December quarter, with an overall negative volume growth, as consumers continue to reel under inflationary pressure. However, markets recovered in last hour of trade with Sensex ending more than 200 points higher and Nifty 50 ending flat. Traders found some solace with Commerce and Industry Minister Piyush Goyal's statement that number of measures such as tweaks in customs duties on certain products announced in the Union Budget for 2023-24 will help boost the country's exports. Some support also came with Former Niti Aayog Vice Chairperson Arvind Panagariya's statement that India is on the cusp of returning to a high growth trajectory and voiced confidence that the country will become the world's third-largest economy by 2027-28. He said India is currently in a spot that it was in 2003 when the growth rate picked up to close to about 8 per cent and the country sustained that kind of rate for a few years. Finally, the BSE Sensex rose 224.16 points or 0.38% to 59,932.24 and the CNX Nifty was down by 5.90 points or 0.03% to 17,610.40.

The US markets ended mostly higher on Thursday, with Nasdaq settling over three percent gain. The rise by the Nasdaq came as Meta Platforms (META) led a tech sector rally, with the Facebook parent skyrocketing by 23.3 percent to a nearly eight-month closing high. The spike by Meta came after the company reported better than expected fourth quarter revenues and announced a $40 billion stock buyback. Stocks also continued to benefit from a positive reaction to the Federal Reserve's interest rate announcement on Wednesday, with traders expressing optimism the Fed is nearing the end of its rate hiking cycle. At the same time, the Dow bucked the uptrend due partly to a notable decline by shares of Merck (MRK), which tumbled by 3.3 percent after the drug giant provided disappointing guidance. Meanwhile, traders were also looking ahead to the release of the Labor Department's closely watched monthly jobs report on Friday. Street currently expected employment to increase by 185,000 jobs in January after jumping by 223,000 jobs in December, while the unemployment rate is expected to inch up to 3.6 percent from 3.5 percent. on the sectoral front, Airline stocks moved sharply higher on the day, with the NYSE Arca Airline Index soaring by 5.7 percent to its best closing level in almost eight months. Substantial strength was also visible among software stocks, as reflected by the 3.8 percent spike by the Dow Jones U.S. Software Index. With the jump, the index reached a five-month closing high.

Crude oil futures ended lower on Thursday continuing to be weighed down by data showing an increase in U.S. crude inventories last week. The dollar's recovery and uncertainty about the outlook for energy demand due to concerns about a global recession hurt as well. Meanwhile, the Bank of England raised interest rates by half a percentage point. Benchmark crude oil futures for March delivery fell $0.53 or 0.7 percent at $75.88 a barrel on the New York Mercantile Exchange. Brent crude for April delivery dropped $0.72 or 0.88 percent at $82.12 (Provisional) a barrel on London's Intercontinental Exchange.

Indian rupee tumbled against dollar on Thursday, weighed down by foreign fund outflows and corporate dollar demand. Traders were worried as Moody's Investors Service said that the Indian federal government's aim to achieve a fiscal deficit target of 4.5% of gross domestic product (GDP) by 2025/26 could see some risks. The current pattern suggests that perhaps there could be some upward pressure on expenditure especially if they (government) continue with this focus on capex. On the global front, the British pound slipped on Thursday to its lowest level against the euro since September as investors awaited the Bank of England and European Central Bank policy decisions later in the day. Finally, the rupee ended at 82.20 (Provisional), weaker by 40 paise from its previous close of 81.80 on Wednesday.

The FIIs as per Thursday's data were net buyers in both equity and debt segment. In equity segment, the gross buying was of Rs 14804.64 crore against gross selling of Rs 12262.01 crore, while in the debt segment, the gross purchase was of Rs 3041.96 crore against gross selling of Rs 176.02 crore. Besides, in the hybrid segment, the gross buying was of Rs 1.32 crore against gross selling of Rs 7.91 crore.

The US markets ended mostly in green on Thursday as a more dovish-than-expected message from Federal Reserve Chair Jerome Powell boosted equities and Meta Platforms shares soared on rigorous cost controls. Asian markets are trading mixed on Friday with Chinese and Hong Kong stocks declining after tech giants Apple, Amazon and Alphabet posted disappointing financial results. Indian markets ended mixed on Thursday weighed down by continuous selling in Adani Group stocks. Today, markets are likely to open in green amid mixed global cues and ahead of Services PMI data to be out later in the day. Some support will come as Central Board of Indirect Taxes and Customs (CBIC) chief Vivek Johri said monthly GST collection is expected to average around Rs 1.50 lakh crore and it will be the new normal in FY24 in view of concerted efforts to check evasion and bring new businesses within the GST net. Traders may take note of report that the seven-month-old windfall profit tax on domestically produced crude oil and export of fuel is likely to give about Rs 25,000 crore in the current fiscal ending March 31 and the levy will continue for now as international oil prices are up again. However, some cautiousness may come due to foreign fund outflows. Foreign institutional investors (FII) net-sold shares worth Rs 3,065.35 crore, as per provisional data available on the NSE. There will be some buzz in the sugar industry stocks industry body ISMA said the country's sugar production rose 3.42 per cent to 193.5 lakh tonnes in the first four months of the ongoing marketing year ending September, on rise in output in key producing states. Aviation industry stocks will be in focus as the Union Ministry of Civil Aviation stated that India's aviation industry suffered a loss of over Rs 24,000 crore in the last two financial years during 2020-22. As per the Union Ministry of Civil Aviation, the industry in FY 2020-21 suffered a loss of Rs 12,479 crore and in FY 2021-22 it was Rs 11,658 crore. There will be some reaction in railways stocks with report that the railways' revenue earnings are up by 73 per cent in the passenger segment during April-January 2023 as compared to the same period last year. Investors awaited more of financial results from India Inc for domestic cues, with ITC, SBI, InterGlobe Aviation and more due to post their earnings later in the day. Meanwhile, amid massive stock rout for almost a week in most of Adani group stocks, the National Stock Exchange (NSE) has put Adani Enterprises, Adani Ports and Ambuja Cements under additional surveillance measure (ASM) framework effective February 3, 2023 to curb short-selling.

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

Nifty Top volumes

• Tata Steel has acquired 26,97,674 equity shares of Rs 10 each at a premium of Rs 205 per share, of Tata Steel Utilities and Infrastructure Services on Rights basis. 
• HDFC has reported rise of 14.74% in its consolidated net profit at Rs 7077.91 crore for Q3FY23 as compared to Rs 6168.58 crore for the same quarter in the previous year. 
• Hero MotoCorp has sold 356,690 units of two-wheelers in January 2023, a fall of 6.25% over January 2022, when the company had sold 380,476 units. 
• Britannia Industries has reported over 2- fold jump in its consolidated net profit at Rs 932.40 crore for Q3FY23 as compared to Rs 369.18 crore for the same quarter in the previous year.