Indian equity benchmarks trimmed initial gains to close marginally higher in a highly volatile trade on Monday. Markets made a slightly positive start and managed to keep their heads above water for the most part of the session as traders took some support with private report that Inflation in goods and services other than fuel and food is likely to remain low, around 3% in the near term, owing to weak rural demand, softness in housing inflation and lower input cost pressures. Some solace also came as Moody's raised India's growth forecast for 2024 calendar year to 6.8 per cent, from 6.1 per cent estimated earlier, on the back of stronger-than-expected economic data of 2023 and fading global economic headwinds. However, gains remained capped as provisional data from the NSE showed foreign institutional investors (FIIs) net sold shares worth Rs 81.87 crore on March 2, 2024. Traders took a note of Reserve Bank of India's (RBI) Monetary Policy Committee (MPC) member Ashima Goyal's statement that the Indian economy has done well despite multiple external shocks, but counter-cyclical macroeconomic policy measures will be required to aid the economy's natural resilience as geopolitical situation remains fragile. Goyal further said inflation in the country has come down but it has not yet reached the target levels. Finally, the BSE Sensex rose 66.14 points or 0.09% to 73,872.29 and the CNX Nifty was up by 27.20 points or 0.12% to 22,405.60.

The US markets ended in red on Monday as Federal Reserve Chair Jerome Powell's congressional testimony will be in focus for clues about the outlook for interest rates. Powell is due to testify before the House Financial Services Committee on Wednesday and the Senate Banking Committee on Thursday. After a weak start and a subsequent long spell in negative territory, US stocks briefly managed to turn positive in the final hour, but failed to find support and ended marginally down on Monday. The mood was cautious right through the day's session due to a lack of major U.S. economic data. Traders largely stayed on the sidelines ahead of a slew of key events this week. On Tuesday, the Institute for Supply Management is due to release its report on service sector activity in the month of February. In the stock specific developments, Tesla dropped more than 7 percent. Walgreens Boots Alliance, Target, Alphabet, Pfizer, Apple Inc., Nike and Merck lost 2 to 4 percent. However, Intel, Nvidia, IBM, Bank of America, Ford Motor, Qualcomm, eBay, Walt Disney, General Electric, Wells Fargo, Costco and Citigroup posted strong gains.

Crude oil futures ended lower on Monday amid concerns about the outlook for energy demand after the Organization of Petroleum Exporting Countries and its allies, collectively known as OPEC+ decided to extend their output cuts till the end of the second quarter. After their meeting on Sunday, OPEC+ announced that the 2.2 million barrels per day of voluntary output cuts that were planned for the first quarter of this year will continue into the next quarter. Benchmark crude oil futures for April delivery fell $1.23 or about 1.5% to settle at $78.74 a barrel on the New York Mercantile Exchange. Brent crude for May delivery was down by $0.75 or about 0.9% to $82.80 per barrel on London's Intercontinental Exchange.

Indian rupee ended higher on Monday tracking a weak American currency overseas and positive equity market sentiment. Some support came in as global rating agency Moody's has raised India's Gross Domestic Product (GDP) growth forecast for 2024 calendar year to 6.8 per cent, from 6.1 per cent estimated earlier, on the back of stronger-than-expected economic data of 2023 and fading global economic headwinds. On the global front, U.S. dollar drifted within a tight range on Monday, pressured by lower Treasury yields, as traders waited for more crucial economic data for fresh clues on the timing of Federal Reserve interest rate cuts. Finally, the rupee ended at 82.89 (Provisional), stronger by 2 paise from its previous close of 82.91 on Friday.

The FIIs as per Monday's data were net buyers in equity segment, while they were net sellers in debt segment. In equity segment, the gross buying was of Rs 18241.90 crore against gross selling of Rs 16070.76 crore, while in the debt segment, the gross purchase was of Rs 1225.72 crore with gross sales of Rs 1442.08 crore. Besides, in the hybrid segment, the gross buying was of Rs 20.66 crore against gross selling of Rs 18.73 crore.

The US markets ended lower on Monday backing away from record highs, while US Treasury yields ticked higher as investors looked ahead to key jobs data and Federal Reserve Chair Jerome Powell's congressional testimony later in the week. Asian markets are trading mostly in red on Tuesday after China set out an economic growth target of around 5 per cent for 2024, which was largely in-line with expectations. Indian markets after touching new heights in the early deals settled flat with a positive bias on Monday as investors avoided to take any long position ahead of FED chair testimony. Today, markets are likely to get a cautious start amid weak cues from global markets. Investors will be eyeing HSBC Services PMI data to be out later in the day for more directional cues. Foreign fund outflows likely to dent Sentiments. Foreign institutional investors (FIIs) net sold shares worth Rs 564.06 crore on March 4, provisional data from the NSE showed. However, some support will come with a private report that Inflation may decline for two years in a row. As per the report, inflation is likely to fall to 4.3 per cent in the financial year 2024-25 from 5.4 per cent in the financial year 2023-24. Traders may take note of a report released by the National Statistical Office (NSO) showing that India's unemployment rate dropped to 3.1 per cent in 2023 from 3.6 per cent in the preceding year, reflecting continued improvement in the labour markets. During the calendar year 2023 (CY23), the unemployment rate in both rural and urban areas declined to 2.4 per cent and 5.2 per cent, respectively, from 2.8 per cent and 5.9 per cent in 2022. Sugar industry stocks will be in limelight as industry body ISMA said the country's sugar production declined 1.19 per cent to 25.53 million tonne so far in the ongoing 2023-24 marketing year. Sugar production stood at 25.84 MT till February in the year-ago period. Sugar marketing year runs from October to September. There will be some reaction in aviation industry stocks as the Ministry of Civil Aviation's data showed that the average daily domestic air traffic jumped by 3.78 per cent month-on-month (MoM) to 439,464 passengers in February. The Street will also see two new stock debuts. Exicom Tele Systems and Platinum Industries will get listed against their issue prices of Rs 142 and Rs 171, respectively.

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

Nifty Top volumes

• Tata Motors has flagged off its next-generation, green-fuel powered commercial vehicles to Tata Steel.
• Adani Ports and SEZ has handled 35.4 MMT of total cargo in February 2024, implying a healthy 33% Year-on-Year growth.
• NTPC has received an investment approval for Singrauli Super Thermal Power Project, Stage-III (2x800 MW) at an appraised current estimated cost of Rs 17,195.31 crore.
• Infosys has entered into a strategic collaboration with PROG Holdings, Inc.