Indian equity benchmarks erased all of their intra-day gains and ended flat on Tuesday on fag end profit-booking amid weak global cues. Markets made an optimistic start as traders took encouragement with Economic Affairs Secretary Ajay Seth's statement that Indian financial system is well protected and regulated despite the daunting global financial situation. Some solace also came as Fitch Ratings affirmed India's sovereign rating with a stable outlook and said that the country has a robust growth outlook and resilient external finances. It has affirmed the country's Long-Term Foreign-Currency Issuer Default Rating (IDR) at BBB- with a Stable Outlook and added that strong growth potential is a key supporting factor for the sovereign rating. Sentiments remained positive in noon deals, as provisional data from the National Stock Exchange showed foreign institutional investors (FII) bought shares worth Rs 2,123.76 crore on May 8, 2023. Traders took a note of Union Finance Minister Nirmala Sitharaman's statement that regulators should maintain a constant vigil as ensuring financial sector stability is a shared responsibility of the regulators. She said regulators must take appropriate and timely action to mitigate any vulnerability and strengthen financial stability. However, markets failed to hold initial gains and ended flat as traders turned cautious ahead of April inflation data and a series of Q4 corporate earnings. Meanwhile, the Reserve Bank's gold reserves increased by 34.22 tonne year-on-year to reach 794.64 tonne at March-end 2023. The Reserve Bank held 760.42 metric tonnes of gold (including gold deposits of 11.08 metric tonnes) at the March-end of 2022. Finally, the BSE Sensex fell 2.92 points to 61,761.33 and the CNX Nifty was up by 1.55 points or 0.01% to 18,265.95.

The US markets ended lower on Tuesday amid ongoing concerns about the outlook for the global economy following disappointing Chinese trade data. Also, traders preferred to move out with relatively risky assets ahead of the release of key inflation data in the coming days. The reports on consumer and producer price inflation, which are due to be released on Wednesday and Thursday, respectively, could have a significant impact on the outlook for interest rates. Ahead of the data, CME Group's FedWatch Tool is currently indicating an 76.5 percent chance the Federal Reserve will leave interest rates unchanged at its next meeting in June. Fed Chair Jerome Powell said following last week's rate hike that the central bank would take a data-dependent approach to future monetary policy decisions. Some concerns also came about the debt ceiling ahead of a meeting between President Joe Biden and House Speaker Kevin McCarthy, R-Calif. McCarthy has called for any deal on raising the debt ceiling to include spending cuts and told NBC News earlier today he is not in favor of a short-term fix. Besides, lack of major U.S. economic data keeping some traders on the sidelines. On the sectoral front, Tobacco stocks showed a significant move to the downside on the day, dragging the NYSE Arca Tobacco Index down by 2.3 percent to its lowest closing level in well over five months. Considerable weakness was also visible among semiconductor stocks, as reflected by the 1.9 percent slump by the Philadelphia Semiconductor Index. Chipmaker Skyworks Solutions (SWKS) posted a steep loss after reporting better than expected fiscal second quarter results but providing disappointing guidance for the current quarter.

Crude oil futures ended higher on Tuesday amid expectations of higher seasonal demand and on the U.S. government's plans to refill the emergency oil reserve. The Energy Information Administration (EIA) said in a report that seasonal demand for oil is likely to be higher this year. The EIA said it expects crude production will rise 5.1% to 12.53 million barrels per day this year, but lowered its output estimate for the current year and the next from earlier forecasts. The EIA has also cut its price target for Brent and WTI by over 7% to $78.65 a barrel and $73.62 a barrel, respectively. Benchmark crude oil futures for June delivery rose $0.55 or about 0.8 percent to settle at $73.71 a barrel on the New York Mercantile Exchange. Brent crude for July delivery added $0.35 or 0.45 percent to settle at $77.36 a barrel on London's Intercontinental Exchange.

Indian Rupee ended lower against the US dollar on Tuesday weighed down by a strong greenback against major rivals overseas and a muted trend in domestic equities. Traders failed to take support from a report that Fitch Ratings affirmed India's sovereign rating with a stable outlook saying the country has a robust growth outlook and resilient external finances. Besides, Economic Affairs Secretary Ajay Seth said that Indian financial system is well protected and regulated despite the daunting global financial situation. On the global front, the dollar edged up against major currencies on Tuesday as traders awaited U.S. debt ceiling talks and new inflation data for a clearer picture of the outlook for the economy and U.S. interest rates. Finally, the rupee ended at 82.05 (Provisional), depreciating by 27 paise from its previous close of 81.78 on Monday.

The FIIs as per Tuesday's data were net buyers in both equity and debt segment. In equity segment, the gross buying was of Rs 9385.45 crore against gross selling of Rs 6222.93 crore, while in the debt segment, the gross purchase was of Rs 1583.02 crore against gross selling of Rs 707.49 crore. Besides, in the hybrid segment, the gross buying was of Rs 6.82 crore against gross selling of Rs 7.14 crore.

The US markets ended lower on Tuesday amid the ongoing stalemate in Washington over raising the U.S. debt limit and ahead of key inflation data. Asian markets are trading mixed on Wednesday after U.S. President Joe Biden and top lawmakers failed to break a deadlock on the debt ceiling crisis. Indian markets ended flat on Tuesday as selling in US index futures, forced investors to book profits. Today, the markets are likely to get flat-to-positive start amid mixed global cues ahead of US CPI data later tonight. Marketmen will be looking for directional cues from Q4 earnings with stocks of L&T, Dr Reddy's, Sanofi, Godrej Consumer and Gujarat Gas on radar ahead of their results. The Karnataka assembly election may also impact sentiment as investors assess exit polls late in the day. Voting in the Karnataka polls -- a state that may set the stage for the 2024 general elections. Historically, the state has never voted the incumbent party to power in almost four decades. The counting of votes will take place on May 13. Sentiments will get a boost with continued foreign fund inflows. Foreign institutional investors bought shares worth Rs 1942 crore in the market on Tuesday. Some support will come with report that the free trade agreement between India and the UAE has transformed the partnership between the two countries by promoting two-way commerce at a healthy rate. Traders may take note of report that Finance minister Nirmala Sitharaman said on Tuesdy that the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) has provided crucial support to around 664,000 families, who have received ?13,290 crore against their claims. Meanwhile, the commerce ministry's arm DGTR has recommended imposition of anti-dumping duty on imports of a certain type of optical fibres from China, Korea and Indonesia to protect the domestic industry from cheap inbound shipments. Besides, disbursal of claims under the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), which offers death coverage due to any reason, shot up by 438 per cent in 2021-22 to 340,192, reflecting the higher number of deaths during the second wave of Covid.

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

Nifty Top volumes

• Reliance Industries' subsidiary -- Reliance Jio Infocomm has entered into a partnership with IRM India Affiliate to strengthen and promote Enterprise Risk Management in the telecom industry. 
• Bharti Airtel has registered 2 million customers onto its 5G network in Mumbai thus far. 
• ITC's hospitality arm -- ITC Hotels has signed three more properties under the Storii brand in Goa, Himachal Pradesh and Uttar Pradesh.
• Infosys has been positioned as a Leader in both The Forrester Wave: Multicloud-Managed Services Providers, Q1 2023 and The Forrester Wave: Cloud Migration And Managed Service Partners In Asia Pacific, Q4 2022 reports.