Indian equity benchmarks ended lower on Monday, tracking weak cues from global markets as investors continued to assess the impact of new Western sanctions on Russia and the Fed's plans to shrink its balance sheet. Benchmarks made negative start and stayed in red for whole day, as investors awaited the onset of the corporate earnings season with Tata Consultancy Services (TCS) due to report its financial results for the March quarter after market hours today. Traders were concerned as the Reserve Bank data showed that in the steepest weekly fall ever, India's forex reserves slid by $11.173 billion to $606.475 billion as the currency came under pressure due to geopolitical developments. Some anxiety also came as Revenue Secretary Tarun Bajaj warned that FY23 was unlikely to see a rate of growth in tax collections similar to that in FY22. Weakness persisted in markets in afternoon trade amid a private report stating that India's retail inflation likely sped up to a 16-month high of 6.35% in March, well above the Reserve Bank of India's upper tolerance band for a third straight month, in part due to a sustained rise in food prices. Sentiments remained down-beat after exchange data showed foreign institutional investors (FIIs) were net sellers in the capital market on Friday, as they offloaded shares worth Rs 575.04 crore. Adding more worries, the US government said that India's proposed data localisation requirements under which firms need to store data within India will serve as significant barriers to digital trade between the two countries. Traders overlooked the Commerce and Industry Ministry stated that India's agricultural exports rose by about 20 per cent to $50.21 billion during 2021-22 despite logistical challenges posed by the COVID-19 pandemic. Market participants also failed to take any sense of relief as preliminary data of the commerce ministry showed that India's exports grew by 37.57 per cent to $9.32 billion during April 1-7. Finally, the BSE Sensex fell 482.61 points or 0.81% to 58,964.57 and the CNX Nifty was down by 109.40 points or 0.62% to 17,674.95.

The US markets settled deeply in red on Monday on worries about the ongoing war between Russia and Ukraine. Further, the coronavirus outbreak also weighed on the markets. The weakness on markets also came amid a continued increase in treasury yields, with the yield on the benchmark ten-year note reaching its highest levels in three years. Besides, weakness in the overseas markets carried over onto Wall Street amid concerns about the outlook for monetary policy and the global economy. Meanwhile, Energy stocks helped to lead the markets lower amid a steep drop by the price of crude oil. Crude for May delivery tumbled $3.97 to $94.29 a barrel amid concerns about the outlook for demand. Reflecting the weakness in the energy sector, the NYSE Arca Oil Index plunged by 3 percent and the Philadelphia Oil Service Index plummeted by 2.8 percent. Significant weakness was also visible among biotechnology stocks, as reflected by the 2.5 percent drop by the NYSE Arca Biotechnology Index. Semiconductor, healthcare and retail stocks also saw notable weakness, while airline stocks were among the few groups to the downtrend.

Crude oil futures ended sharply lower on Monday as Chinese coronavirus lockdowns continued, raising concerns about demand from the world's biggest crude importer. China's largest Covid-19 outbreak in two years continues to spread despite an extended lockdown of Shanghai's 25 million people. With China maintaining its COVID Zero strategy, investors fear that there will be consequences for global growth, supply chains and inflation. Benchmark crude oil futures for May delivery fell $3.97 or 4 percent to settle at $94.29 a barrel on the New York Mercantile Exchange. Brent crude for June delivery dropped $4.16 or 4.18 percent to settle at $102.64 a barrel on London's Intercontinental Exchange.

Indian rupee ended marginally higher against dollar on Monday, on persistent selling of the American currency by exporters. Some solace came with Commerce and Industry Ministry statement that India's agricultural exports rose by about 20 per cent to $50.21 billion during 2021-22 despite logistical challenges posed by the COVID-19 pandemic. However upside remain capped with Reserve Bank data released showing that in the steepest weekly fall ever, India's forex reserves slid by $11.173 billion to $606.475 billion as the currency came under pressure due to geopolitical developments. For the previous reporting week ended March 25, the overall reserves had slid by $2.03 billion to $617.648 billion. Besides, selloff in equity markets also impacted traders' sentiments. On the global front, sterling fell on Monday against the euro and the dollar after data showed the UK economy slowed more sharply than expected in February. Finally, the rupee ended at 75.91 (Provisional), stronger by 2 paise from its previous close of 75.93 on Friday.

The FIIs as per Monday's data were net sellers in both equity and debt segment. In equity segment, the gross buying was of Rs 9562.21 crore against gross selling of Rs 9957.59 crore, while in the debt segment, the gross purchase was of Rs 580.89 crore against gross sales of Rs 626.88 crore. Besides, in the hybrid segment, the gross buying was of Rs 2.76 crore against gross selling of Rs 13.74 crore.

The US markets ended lower on Monday as bond yields rose to a 3-year high ahead of inflation data. Asian markets are trading mostly in red on Tuesday as Treasury yields spike to a three year high ahead of US inflation data which could foreshadow even more aggressive interest rate hikes from the Fed. Indian markets fell on Monday tracking weakness across global equities, dragged by financial and IT shares though gains in oil & gas and select metal stocks limited the downside. Today, markets are likely to continue their previous sessions' losing momentum with gap-down opening amid weak global cues. Investors will continue to keep a watch on the geo-political tensions amid talks of EU likely to discuss sanctioning Russian oil. Investors will be eyeing macro-economic data with the CPI and IIP numbers for March and Feb, respectively, slated to be released later in the day. As per a private report, India's retail inflation likely sped up to a 16-month high of 6.35% in March, well above the Reserve Bank of India's upper tolerance band for a third straight month, in part due to a sustained rise in food prices. However, some support may come later in the day as data from the Reserve Bank of India (RBI) showed India Inc's direct overseas investment increased 8.5 per cent year-on-year to $3.34 billion in March 2022. Besides, Finance Minister Nirmala Sitharaman held a meeting with newly appointed IMF's Monetary and Financial Committee chair Nadia Calvino and stressed the need for timely completion general review of quotas of the International Monetary Fund to give more say to developing countries. Energy stocks will be in focus as Union Minister for Petroleum and Natural Gas Hardeep Singh Puri said India is on its way to become a global energy superpower in terms of consumption and production. There will be some buzz in telecom industry stocks as the Telecom Regulatory Authority of India (Trai) has set the stage for next-gen spectrum auction by slashing the reserve price of 5G airwaves in the 3300-3670 MHz band by around 36 per cent. Insurance industry stocks will be in limelight as the non-life insurance industry reported an 11 per cent growth in premiums to Rs 2.20 trillion in FY22 after a low single digit growth in FY21. There will be some reaction in textile industry stocks with a private report that a sharp jump in domestic cotton prices since February, caused partly by a drop in output, has hit the country's textiles-and-clothing value chain, rendering hundreds of thousands jobless. Meanwhile, Reserve Bank of India said 22 NBFCs, including BNP Paribas India Finance, Swiss Leasing and Finance, and Available Finance, have surrendered their registration certificates. There will be some result announcements to keep the markets in action.

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

Nifty Top volumes

• Maruti Suzuki India's NEXA has opened bookings for its premium Multi-Purpose Vehicle, the All-New XL6. 
• ICICI Bank has extended its special fixed deposit scheme for senior citizens. 
• Tata Motors is looking to ramp up the production of electric vehicles as demand continues to outpace the manufacturing activity by a huge margin. 
• Tata Consultancy Services has completed 5-year Partnership with The Canberra Times Marathon Festival.