Indian equity benchmarks snapped a three-day winning streak to close marginally lower on Tuesday due to losses in TECK, IT and Telecom stocks. After a weak start, the markets recovered but remained in negative territory for most part of the session as cautiousness prevailed ahead of the RBI monetary policy decision and the start of Q4 earnings season. Traders also remained cautious with provisional data from the NSE showing that foreign institutional investors (FIIs) net sold shares worth Rs 522.30 crore on April 1. Adding to the pessimism, a report by the United Nations Conference on Trade and Development (UNCTAD) showed that India's dependence for trade on the European Union (EU) and China is rising as global trade has seen a restructuring along the geopolitical lines in the past two years. Traders overlooked a private survey showing that the manufacturing sector in India closed out FY24 with a stellar performance in March, as companies stepped up hiring in response to strong production and new orders. The HSBC India Manufacturing PMI rose to a 16-year high of 59.1 in March, from 56.9 in February. While this number was the highest since February 2008, it was lower than HSBC's preliminary estimate of 59.2. A reading of over 50 separates expansion from contraction. Traders also paid no heed towards report that the Centre collected Rs 1.78 lakh crore as gross goods and services tax in the month of March, up 11.5% against the same month last year. This is the second highest monthly gross GST collection. This surge was driven by a significant rise in GST collections from domestic transactions at 17.6%.  However, markets managed to trim some losses in final hour of trade following gains in global markets. Finally, the BSE Sensex fell 110.64 points or 0.15% to 73,903.91 and the CNX Nifty was down by 8.70 points or 0.04% to 22,453.30.

The US markets ended lower on Tuesday with Dow Jones Industrial Average settling cut of one percent amid renewed uncertainty about the outlook for interest rates as traders digested recent U.S. economic data. Treasury yields moved sharply higher in reaction to the data on Monday and saw further upside during today's session, with the yield on the benchmark ten-year note reaching a four-month high. Traders have also taken the opportunity to cash in on some of the recent strength in the markets ahead of remarks by Fed Chair Jerome Powell on Wednesday and the release of the monthly jobs report on Friday. On the sectoral front, networking stocks moved sharply lower over the course of the session, resulting in a 2.7 percent nosedive by the NYE Arca Networking Index. Substantial weakness was also visible among housing stocks, with the Philadelphia Housing Sector Index plunging by 2.5 percent. The index pulled back further off last Thursday's record closing high. Airline stocks also showed a significant move to the downside on the day, dragging the NYSE Arca Airline Index down by 1.8 percent. On the economic data front, the Commerce Department released a report showing a significant rebound in factory orders in the month of February. The Commerce Department said factory orders surged by 1.4 percent in February after plunging by a revised 3.8 percent in January. Street had expected factory orders to jump by 1.0 percent compared to the 3.6 percent slump originally reported for the previous month.

Crude oil futures ended sharply higher on Tuesday amid rising demand, and concerns about supply due to escalating geopolitical tensions. Tighter supply from Mexico also supported oil prices. According to a private report, Petroleos Mexicanos is cutting some oil exports over the next few months. Besides, recent encouraging manufacturing activity data from the U.S. and China signal a potential surge in oil demand from the two largest oil-consuming nations in the world. Benchmark crude oil futures for May delivery rose $1.44 or about 1.72% to settle at $85.15 a barrel on the New York Mercantile Exchange. Brent crude for June delivery gained $1.53 or 1.75% to $88.94 per barrel on London's Intercontinental Exchange.

Indian rupee ended lower against the U.S. dollar on Tuesday weighed down by a strong dollar and elevated crude oil prices. Traders overlooked positive GST collection and India's manufacturing PMI data. The finance ministry has said that Goods and Services Tax (GST) collections in March 2024 witnessed the second highest collection ever at Rs 1.78 lakh crore, with a 11.5 per cent year-on-year growth. While, according to the survey report, the seasonally adjusted HSBC India Manufacturing Purchasing Managers' Index (PMI) rose to 59.1 in March as against 56.9 in February. On the global front, U.S. dollar hit its highest in almost five months on Tuesday as stronger-than-expected economic data caused investors to rein in their bets on a June rate cut, boosting the currency. Fears of intervention by Japanese officials slowed the dollar's gains against the yen, however, even as long-term U.S. Treasury yields - which the currency pair tends to track - jumped to a two-week top overnight. Finally, the rupee ended at 83.42 (Provisional), weaker by 3 paise from its previous close of 83.39 on Thursday.  

The FIIs as per Tuesday's data were net buyers in equity and debt segments both. In equity segment, the gross buying was of Rs 39847.77 crore against gross selling of Rs 37492.54 crore, while in the debt segment, the gross purchase was of Rs 5991.79 crore with gross sales of Rs 1268.74 crore. Besides, in the hybrid segment, the gross buying was of Rs 30.55 crore against gross selling of Rs 31.19 crore.

The US markets ended lower on Tuesday as investors weighed chances that the Federal Reserve could delay cutting interest rates, while Tesla shares dropped after the electric car maker posted fewer quarterly deliveries for the first time in nearly four years. Asian markets are trading in red on Wednesday with markets watching for moves in electric vehicle makers. Indian markets snapped the three-day gaining run and ended in red on Tuesday due to profit-taking in select private bank and auto shares amid weak trends from the US markets and foreign fund outflows. Today, markets are likely to witness selling pressure with gap-down opening tracking weakness in global markets, after data showing strong labour demand raised fears of a delayed rate cut by the Fed. The US 10-year bond yield rose to 4.40 per cent. Investors also likely to remain cautious as the RBI appointed MPC (Monetary Policy Committee) begin their 3-day meet to discuss policy measures. The RBI will announce the outcome on Friday. There are expectations that MPC may keep the repo rate unchanged. Foreign fund outflows likely to dent sentiments. Foreign institutional investors (FII) sold shares net worth Rs 1,622.69 crore on April 03, 2024, according to the provisional data available on the NSE. However, some respite may come later in the day as revising its earlier projections for the same period by 1.2 per cent, the World Bank said the Indian economy is projected to grow at 7.5 per cent in 2024. Some support may come as the government has broadly met the tax collection target of over Rs 34.37 trillion for 2023-24 on the back of robust economic activity and improved compliance. The government had raised the target for direct tax collection in FY24 (April 2023 to March 2024) to Rs 19.45 trillion, while for indirect taxes (GST+ Customs + Excise) the target was lowered to Rs 14.84 trillion in the revised estimates (RE) presented in Parliament on February 1, 2024. Sugar industry stocks will be in focus after Indian Sugar Mills Association (ISMA) has requested the government to allow the export of 10 lakh tonne of sugar in the current 2023-24 season, anticipating healthy closing stock by the season-end. Sugar production has reached 302.20 lakh tonne till March of the current season against 300.77 lakh tonne in the year-ago period. There will be some reaction in edible oil industry stocks with a private report that India's sunflower oil imports rose by 51% in March from the previous month to reach the second highest level on record, as lower prices led refiners to increase their purchases, while reducing buying of rival palm oil. Aviation industry stocks will be in limelight as aviation consultancy firm CAPA India's data showed that the domestic and international air traffic in India for the first time crossed the pre-pandemic peak of 2018-19 in 2023-24 due to sustained increase in demand. International air traffic in India saw faster growth than domestic air traffic in 2023-24. Meanwhile, SRM Contractors will list its equity shares on the bourses on April 3. The final issue price has been fixed at Rs 210 per share. The stock will be in trade-for-trade segment for 10 trading days.

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

Nifty Top volumes

• Bajaj Auto has reported rise of 25% in total sales to 3,65,904 units in March 2024 as against 2,91,567 in the same month last year.
• Maruti Suzuki India's production rose 8.16% to 166,730 units in March 2024 as compared to 154,148 units in the same month a year ago.
• Reliance Industries' telecom arm -- Reliance Jio Infocomm has added 4.18 lakh customers in January 2024.
• NTPC has logged an all-time high annual electricity generation of 422 billion units in 2023-24, registering a growth of nearly 6 per cent over 2022-23.