In a volatile session, Indian Benchmark indices erased most of the gains towards the end but still ended higher on Thursday, with investors eyeing quarterly updates from companies ahead of corporate earnings season. Benchmarks made positive start and added gains in morning deals with strong foreign flows. As per provisional data available on the NSE, foreign institutional investors (FIIs) remained net buyers to the tune of Rs 1,344.63 crore on October 4. Some support came in as the IMF said recent tightening actions by many central banks around the world will help to prevent high inflation from becoming entrenched. Sentiments remained optimistic amid a private report stating that the Department of Commerce is considering the formation of dedicated units called 'subject matter divisions' to build expertise in industries like services, agriculture, medicines, trade remedies, and digital trade as part of a more aggressive approach to free trade agreements. India wants to be able to negotiate agreements with other nations at the World Trade Organization from a position of strength. However, key gauges pared most of their gains in late afternoon session, as some concern came with private survey showed that growth in India's services industry slumped in September to a six-month low, led by a substantial easing in demand amid high inflation. The S&P Global India services Purchasing Managers' Index fell to 54.3 in September from August's 57.2, much lower than the Reuters poll expectation for a gentle drop to 57.0. Despite staying above the 50-mark separating growth from contraction for the fourteenth straight month - the longest stretch of expansion since October 2016 - the index fell to its lowest since March. Some pessimism also came in as the World Trade Organization (WTO) slashed its global trade growth forecast for 2023, stating that elevated commodity prices and rising interest rates would curb import demand, and warned of a likely contraction if the conflict in Ukraine escalates. Finally, the BSE Sensex rose 156.63 points or 0.27% to 58,222.10 and the CNX Nifty was up by 57.50 points or 0.33% to 17,331.80.

The US markets ended lower on Thursday as traders continued to express concerns about the outlook for interest rates and the impact higher rates will have on the economy. A continued rebound by treasury yields also weighed on the markets, with the yield on the benchmark ten-year note extending the sharp upward move seen on Wednesday.  Weakness also prevailed in the markets as the Labor Department released a separate report showing first-time claims for US unemployment benefits rebounded by more than expected in the week ended October 1st. The report said initial jobless claims climbed to 219,000, an increase of 29,000 from the previous week's revised level of 190,000. Street had expected jobless claims to inch up to 200,000 from the 193,000 originally reported for the previous week. On the sectoral front, Interest rate-sensitive utilities and commercial real estate stocks turned in some of the market's worst performances, with the Dow Jones Utility Average and the Dow Jones U.S. Real Estate Index plunging by 3.0 percent and 2.8 percent, respectively. Substantial weakness was also visible among telecom stocks, as reflected by the 2.9 percent slump by the NYSE Arca North American Telecom Index. The index tumbled to its lowest closing level in over two years. Banking stocks also showed a significant move to the downside on the day, dragging the KBW Bank Index down by 1.9 percent.

Crude oil futures ended higher on Thursday, magnifying their recent rally, holding at three-week highs after OPEC+ agreed to tighten global supply with a deal to cut production targets by 2 million barrels per day (bpd), the largest reduction since 2020. The agreement between the Organization of Petroleum Exporting Countries (OPEC) and allies including Russia, a group known collectively as OPEC+, comes ahead of a European Union embargo on Russian oil and would squeeze supplies in an already tight market, adding to inflation. Benchmark crude oil futures for November delivery rose $0.69 or 0.8 percent at $88.45 a barrel on the New York Mercantile Exchange. Brent crude for December delivery surged $ 1.05 or about 1.1 percent to settle at $94.42 a barrel on London's Intercontinental Exchange.

Indian rupee tumbled against dollar on Thursday amid rising crude oil prices and sustained dollar demand from importers and banks. Traders were concerned as India's services sector growth declined in the month of September, as both new business inflows and output rose at the slowest rates since March, amid inflationary pressures and competitive conditions, which in turn dampened job creation. The seasonally adjusted S&P Global India Services PMI Business Activity Index fell from 57.2 in August to 54.3 in September. Traders took a note of Reserve Bank of India's (RBI) latest report stating that India Inc's foreign commercial borrowings in August this year rose by nearly 4.6 per cent to USD 2.98 billion. On the global front, Sterling edged lower on Thursday after a sharp drop the previous day, as investors waited for Friday's highly significant U.S. jobs data. Finally, the rupee ended at 82.17 (Provisional), weaker by 55 paisa from its previous close of 81.62 on Tuesday.

The FIIs as per Thursday's data were net buyers in equity segment, while net sellers in debt segment. In equity segment, the gross buying was of Rs 7210.75 crore against gross selling of Rs 5274.67 crore, while in the debt segment, the gross purchase was of Rs 115.96 crore against gross selling of Rs 501.29 crore. Besides, in the hybrid segment, the gross buying was of Rs 4.46 crore against gross selling of Rs 17.89 crore.

The US markets ended lower on Thursday as concerns mounted ahead of closely watched monthly nonfarm payrolls numbers due on Friday that the Federal Reserve's aggressive interest rate stance will lead to a recession. Asian markets are trading mostly in red on Friday tracking overnight losses on Wall Street. Indian markets pared some early gains to end modestly higher on Thursday, tracking mixed global cues and a surge in international oil prices. Today, markets are likely to get negative start following weakness in global peers. Traders will be concerned as the World Bank projected a growth rate of 6.5 per cent for the Indian economy for the fiscal year 2022-23, a drop of one per cent from its previous June 2022 projections, citing deteriorating international environment. It added that private investment growth is likely to be dampened by heightened uncertainty and higher financing costs. It noted that the second half of the calendar year is weak in many countries and will be relatively weak also in India. Also, a fresh estimates by the World Bank showed that about 56 million Indians may have plunged into extreme poverty in 2020 as a result of the pandemic, increasing the global tally by 71 million and making it the worst year for poverty reduction since World War II. However, some respite may come as Chief economic adviser V Anantha Nageswaran said India is still on course for 7% growth in the current fiscal year although downside risks dominate the upside risk but it's better placed than other countries. Foreign fund inflows likely to support trading sentiments. As per provisional data available on the NSE, foreign institutional investors (FIIs) remained net buyers to the tune of Rs 279.01 crore on October 6. Traders may take note of report that Union minister Piyush Goyal has asked the industry to ensure their products meet international quality standards and help build a 'Brand India' as the country aims to become a developed nation by 2047. He also called for convergence of various quality certification related organisations whether it is FSSAI, the BIS, the Rail or Defense establishments. Besides, the Union Finance Ministry released the seventh monthly instalment of post devolution revenue deficit (PDRD) grant of Rs 7,183.42 crore to 14 states. The grant has been released as per the recommendations of the 15th Finance Commission. The panel had recommended a total grant of Rs 86,201 crore to 14 states for 2022-23. Meanwhile, Reserve Bank Governor Shaktikanta Das has launched a new SupTech initiative DAKSH - the bank's Advanced Supervisory Monitoring System, which is expected to make the supervisory processes more robust. Moreover, the Sebi has cancelled the recognition certificate granted to Brickwork Ratings India for repeated lapses and irregularities in discharging its duties.

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

Nifty Top volumes

• Tata Steel through its wholly-owned subsidiary -- T S Global Holdings Pte has concluded the divestment of its 19% equity stake in AI Rimal to Tanmia on October 3, 2022.
• HCL Technologies is planning to hire 1,000 people in Brazil in the next two years and will also open a new technology center in Campinas. 
• Adani Enterprises has incorporated two wholly owned subsidiaries namely Alwar Alluvial Resources and Adani Disruptive Ventures.
• Bharti Airtel has launched Airtel 5G plus in several top cities of India.