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Indian equity indices relinquished early gains to close in the red for the second straight session on Thursday on surging oil prices. Today, benchmark indices are likely to see gap-down opening amid nervousness among investors globally tracking news flow on the Russia-Ukraine war. The talks between Ukraine and Russia have not seemed to make any headway and thus high volatility amid rising commodity and oil prices may continue. There will be some cautiousness with a private report that India's trade and current account deficits are likely to widen, putting pressure on the rupee, as global oil prices surge and the domestic economy reopens from a third wave of the pandemic. Traders may take note of report that commerce and industry minister Piyush Goyal said Industry needs to find out ways to raise the share of exports in the country’s gross domestic product (GDP) to about 25%. He also made a fresh appeal for driving up the share of the manufacturing sector in GDP to 25%. Meanwhile, keen to keep government deficit within stated targets, the finance ministry will from March 15 start daily monitoring of the revenue receipts, including tax collections, as well as expenditure. Banking stocks will be in focus as the RBI is likely to meet some of the state-run lenders, including State Bank of India and UCO Bank, to discuss payment mechanisms to Russian companies. Indian banks have stopped processing payments to Russian firms after the US imposed sanctions on Russian banks following the invasion of Ukraine last week. There will be some reaction in pharma stocks with a private report stating that in what could be the highest-ever price hike allowed for scheduled drugs (or drugs under price control) in a long time, the National Pharmaceutical (pharma) Pricing Authority (NPPA) is likely to allow a price hike of 10 per cent in April due to steep rise in wholesale price index (WPI)-based inflation. Scheduled drugs roughly constitute 17-18 per cent of the Rs 1.6-trillion domestic pharma market.

The US markets ended lower on Thursday as the Russia-Ukraine crisis kept investors on the edge. Asian markets are trading mostly in red on Friday following weakness over Wall Street overnight.

Back home, Indian equity benchmarks failed to hold initial gains to end Thursday’s session in red terrain, as investors globally overlooked reassuring comments from the Fed amid nervousness on the Russia-Ukraine war front coupled with surging oil prices. Markets made a positive start as the head of the Federal Reserve Jerome Powell said he supports a traditional rate hike of 0.25 percentage points instead of the bigger rise recommended by some policymakers. Key gauges despite trimming some gains stayed in green terrain as sentiments got a boost as preliminary data released by the commerce ministry stated that India's exports rose by 22.36 per cent to $33.81 billion in February on account of healthy growth in sectors like engineering, petroleum and chemicals, even as the trade deficit widened to $21.19 billion. Some support also came after income tax department stated that it has issued refunds worth over Rs 1.83 lakh crore to more than 2.09 crore taxpayers so far this fiscal. This includes 1.70 crore refunds of the 2020-21 fiscal ended March 31, 2021, amounting to Rs 34,202.31 crore. However, markets took U-turn and entered into red terrain in second half of the day as traders opted to book profit amid geopolitical conflict between Russia and Ukraine. Soaring crude prices due to supply disruptions from Russian sanctions too dented investors’ sentiment. Brent crude oil price soared past $118 a barrel on Thursday, the highest level in nine years, as escalated Russia-Ukraine conflict and tightened sanctions on Moscow by western countries, led by the United States, created supply and trade disruptions. Traders also remained anxious as exporters’ body FIEO said export cargoes to CIS (Commonwealth of Independent States) countries are impacted due to ongoing war between Russia and Ukraine as no shipping line is willing to take consignments there. Finally, the BSE Sensex fell 366.22 points or 0.66% to 55,102.68 and the CNX Nifty was down by 107.90 points or 0.65% to 16,498.05.

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