After two days of fall, Indian equity benchmarks ended extremely volatile session with marginal gains on Friday, helped by buying in Metal, Realty and Telecom stocks amid a firm trend in global markets. Frontline indices made an optimistic start and stayed in green for most part of the day, as traders took encouragement with industry body CII stating that India's economy is expected to grow in the range of 6.5-6.7 per cent in the current financial year supported by strong domestic drivers and robust capex momentum of the government. However, markets quickly pared all the gains as traders turned cautious with provisional data from the National Stock Exchange showing that foreign institutional investors (FIIs) sold shares worth Rs 71.07 crore on June 1, 2023. Some concern also came with global rating agency Fitch's report stating that a rise in risk appetite among Indian banks highlights the importance of assessing individual banks' ability to withstand expected and unexpected balance-sheet stress as part of the analysis of their intrinsic creditworthiness. However, markets regained buying momentum in afternoon deals, as some optimism remained among traders with the finance ministry's statement that GST collection in May rose 12 per cent to Rs 1.57 lakh crore as compared to the GST revenues in the same month last year. Buying further crept in as a foreign brokerage has revised upwards its India growth forecast by 70 bps to 6.2 per cent for the current fiscal, citing a better-than-estimated global growth outlook, lower global crude oil prices and robust services exports.  Markets trimmed some gains in final minutes of trade but managed to end higher taking support from G20 Sherpa Amitabh Kant's statement that India's G20 Presidency will remain focused on economic development issues and endeavour to bring all the member countries, including Russia and China, on board amid the ongoing geo-political uncertainties. Finally, the BSE Sensex rose 118.57 points or 0.19% to 62,547.11 and the CNX Nifty was up by 46.35 points or 0.25% to 18,534.10. 

The US markets extended their previous session's northward journey and ended the session with strong gains on Friday. The Nasdaq reached its best closing level in well over a year, while the S&P 500 set a new nine-month closing high. Sentiments got a boost following the release of a closely watched Labor Department report showing U.S. employment surged by much more than expected in the month of May. The report showed non-farm employment soared by 339,000 jobs in May after spiking by an upwardly revised 294,000 jobs in April. Street had expected employment to climb by 190,000 jobs compared to the jump of 253,000 jobs originally reported for the previous month. Meanwhile, the Labor Department said the unemployment rate rose to 3.7 percent in May from 3.4 percent in April. The unemployment rate was expected to inch up to 3.5 percent. Some strength on Wall Street also came in amid reports that the Senate voted to pass the bill raising the U.S. debt ceiling late Thursday night. The Senate voted 63 to 36 in favor of the debt ceiling bill, with 17 Republicans joining with the majority of Democrats to approve the legislation. The passage of the bill eliminates the threat of a potentially disastrous default by the U.S. government, which had been hanging over the markets in recent weeks. On the sectoral front, oil service stocks moved sharply higher along with the price of crude oil, driving the Philadelphia Oil Service Index up by 5.5 percent. The rally by oil service stocks came as the price of crude oil for July delivery jumped $1.64 to $71.74 a barrel. Substantial strength was also visible among steel stocks, while banking stocks also showed a significant move to the upside.

Magnifying previous session's gains, crude oil futures settled notably higher on Friday taking positive lead from the passage of the debt ceiling bill and amid reports about a possible cut in production from OPEC and allies. The Organization of the Petroleum Exporting Countries and allies, collectively known as OPEC+, is scheduled to meet on June 04. Further, cheerful non-farm payroll data for the month of May also contributed to the increase in oil prices. Meanwhile, data from Baker Hughes showed the number of total active drilling rigs in the United States fell by 15 this week. The total rig count fell to 696 this week, which is 31 rigs below this time last year. Benchmark crude oil futures for July delivery rose $1.64 or about 2.3 percent to settle at $71.74 a barrel on the New York Mercantile Exchange. Brent crude for August delivery surged $1.80 or 2.41 percent to settle at $76.08 a barrel on London's Intercontinental Exchange.

Indian rupee ended higher on Friday, supported by broad dollar weakness and a positive trend in domestic equities. Traders got encouragement with finance ministry's statement that Goods and Services Tax (GST) collection rose 12 per cent to Rs 1.57 lakh crore in May 2023. Goods and Services Tax collection in May last year was about Rs 1.41 lakh crore. Last month, GST collection was at a record high of Rs 1.87 lakh crore. On the global front, dollar was heading for its largest weekly fall since mid-January on Friday as the view took hold among investors that the Federal Reserve will forgo an interest rate hike this month, which would diminish the greenback's appeal to non-U.S. buyers. Finally, the rupee ended at 82.31 (Provisional), stronger by 9 paise from its previous close of 82.40 on Thursday.

The FIIs as per Friday's data were net buyers in both equity and debt segment. In equity segment, the gross buying was of Rs 11799.13 crore against gross selling of Rs 9147.15 crore, while in the debt segment, the gross purchase was of Rs 1215.89 crore against gross selling of Rs 1184.47 crore. Besides, in the hybrid segment, the gross buying was of Rs 10.03 crore against gross selling of Rs 45.53 crore.

The US markets ended higher on Friday after a labor market report showing moderating wage growth in May indicated the Federal Reserve may skip a rate hike in two weeks. Asian markets are trading in green on Monday tracking gains on Wall Street. Indian markets snapped their two-day losing streak and eke out slender gains on Friday amid positive global cues. Today, start of the new week is likely to be optimistic helped by firm global cues and continued FII buying. Foreign Portfolio Investors (FPIs) pumped in Rs 43,838 crore in Indian equities in May, the highest level in nine months, supported by strong macroeconomic fundamentals, and reasonable valuations. Traders will be getting encouragement as CII President R Dinesh said private sector investment is set to witness a significant increase, as capacity utilisation in several key sectors has already crossed 80 per cent and economic growth is estimated to be 6.7 per cent in the current financial year. Some support may come with a private report that India's manufacturing, agriculture, and services sector activities are likely to sustain growth in FY24 on the back of private investments and improved high-frequency data, although headwinds of slowing exports, a global slowdown, and monsoon uncertainty may continue. Now, investors focus will be on the RBI's monetary policy meeting. There are expectations that the Reserve Bank of India (RBI) will maintain the policy repo rate at 6.5 per cent during its upcoming June 8 announcement, considering the easing of retail inflation in April and the potential for further decline, indicating the effectiveness of previous policy rate actions. Headed by Reserve Bank Governor Shaktikanta Das, a meeting of the six-member Monetary Policy Committee (MPC) is scheduled for June 6-8. The decision of the 43rd meeting of the MPC would be announced on June 8. However, there may be some cautiousness as the Reserve Bank said falling for the second consecutive week, India's forex reserves dropped by $4.339 billion to $589.138 billion for the week ended May 26. In the previous reporting week, the reserves had declined by $6.052 billion to $593.477 billion. The reserves have been declining as the central bank deploys the kitty to defend the rupee amid pressures caused majorly by global developments. Oil-linked stocks will be in limelight as oil prices jumped over 2 per cent overnight, and another 2 per cent Monday morning, following OPEC kingpin Saudi Arabia's decision to cut production by another million barrels per day. Auto industry stocks will be in focus as Union Minister Nitin Gadkari expressed confidence that India will become the largest automobile market in the world in the next five years under the leadership of Prime Minister Narendra Modi. There will be some reaction in infrastructure industry stocks as Ministry of Statistics and Programme Implementation said 379 out of 800 Rs 150 crore and above project was delayed. According to the ministry, the 379 infrastructure project each entailing an investment of Rs 150 crore or more, have been hit by cost overruns of more than Rs 4.64 lakh crore in April 2023.

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

Nifty Top volumes

• NTPC and Ohmium International have partnered to manufacture proton exchange membrane (PEM) electrolysers to produce green hydrogen in India. 
• HCL Technologies has inked an agreement with IIT-Kharagpur for collaboration in the field of petroleum engineering and earth sciences. 
• Kotak Mahindra Bank in partnership with Myntra has launched its first-of-its-kind co-branded digital fashion & lifestyle credit card. 
• Tata Motors has launched the upgraded Nexon EV MAX XZ+ LUX at a starting price of Rs 18.79 lakh (ex-showroom, All India for the 3.3 kW AC charger).