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Indian equity markets ended higher on Monday, mirroring positive global cues. Today, markets are likely to make negative start amid weak cues from global markets after weak manufacturing data from China and Europe.  There may be cautiousness in the markets as private report stated that the Reserve Bank of India will deliver two more rate increases with the first of 25-30 bps later this week, and then pause for data-prints on domestic inflation and the US economy. The US economy is widely feared to be headed towards a recession this year having already contracted by 0.9 per cent in the June quarter and 1.6 per cent in the previous. If an economy contracts for three consecutive quarters, then it is considered that economy is in recession. However, some respite may come later in the day as finance minister Nirmala Sitharaman said India’s macroeconomic fundamentals are intact and there is no risk of the economy entering into recession or stagflation. She said the government is trying to keep inflation below 7%. There may be some action in cement industry stocks as rating agency Icra said that cement companies are expected to register a 7-8 per cent rise in their volumes in FY23 on strong demand, but operating profit margin may decline due to elevated input costs. It said the operating margins will be the lowest in the last seven years for the cement industry. In FY23, the volume for the cement industry is expected to grow by 7-8 per cent to around 388 million metric tonne. There will be some buzz in telecom industry stocks as Communications Minister Ashwini Vaishnaw said India’s telecom industry is likely to see an investment of Rs 2-3 trillion in the next two years as reforms by the government have removed uncertainty and risks, and provided a stable investment regime.  Buoyed by record bids in the auction of 5G spectrum, Vaishnaw said he expects investments to be infused into both fourth and fifth generation technologies, for providing better voice quality and high-speed data.

The US markets ended lower on Monday in a choppy first session of August trading as Wall Street struggled to sustain July’s momentum. Asian markets are mostly traded in red in early deals on Tuesday following the mildly negative cues from global markets overnight, with weakness in technology, financial and energy-linked shares.

Back home, Indian equity benchmarks continued to rise for a fourth straight session on Monday, led by strength in power, utilities, auto and telecom stocks. Domestic indices made positive start and stayed in green for whole day, amid strong inflows from foreign investors. After nine consecutive months of relentless selling, foreign investors have turned net buyers and invested nearly Rs 5,000 crore in Indian equities in July on softening dollar index and good corporate earnings. Traders also found some encouragement as retail inflation for industrial workers eased to 6.16 per cent in June from 6.97 per cent in May this year due to lower prices of certain food items and petrol. Some optimism also came with the government data showed that the output of eight core infrastructure sectors expanded by 12.7 per cent in June against 9.4 per cent in the year-ago period. Key gauges added gains to trade at day’s high points in late afternoon session, as India's manufacturing sector activity gained momentum in July, hitting an eight-month high driven by a significant uptick in business orders. The seasonally adjusted S&P Global India Manufacturing Purchasing Managers' Index rose from 53.9 in June, to 56.4 in July, highlighting the strongest improvement in the health of the sector in eight months. Sentiments remained upbeat after finance ministry said that India collected Rs 1.49 lakh crore as Goods and Services Tax (GST) in July, posting an increase of 28 percent from the same month last year. Compared to the money collected in June, the July GST mop-up was 3 percent higher. Meanwhile, the Controller General of Accounts (CGA) in its latest data has showed that the central government's fiscal deficit touched 21.2 per cent of the annual target in the June quarter as against 18.2 per cent in the year-ago period. Finally, the BSE Sensex rose 545.25 points or 0.95% to 58,115.50 and the CNX Nifty was up by 181.80 points or 1.06% to 17,340.05. 

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