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Indian markets rose to two-month closing highs on Friday, after a day's breather, boosted by strength across most sectors. Today, the markets are likely to get cautious start amid mixed Asian cues. Investors will be eyeing Manufacturing PMI data to be out later in the day. Traders will be concerned as fuel prices go further up with petrol and diesel rates increased by 40 paise per litre each on April 4. With this fresh round of hike, there is a net increase of Rs 8.40 per litre in 14 days. However, sentiments may get a boost as Niti Aayog Vice Chairman Rajiv Kumar said India is on the cusp of a major economic recovery and talks of possible stagflation are overhyped as a strong economic foundation is being laid with the reforms carried out by the government over the last seven years. Traders may take encouragement, as the Finance Ministry said Gross GST collection in March touched an all-time high of over Rs 1.42 trillion. The gross GST revenue collected in March 2022 is Rs 1.42 trillion, of which CGST is Rs 25,830 crore, SGST is Rs 32,378 crore, IGST is Rs 74,470 crore (including Rs 39,131 crore collected on import of goods) and cess is Rs 9,417 crore (including Rs 981 crore collected on import of goods). Some support will come as the Commerce and Industry Ministry said India's merchandise exports spurt to a record high of $418 billion in the 2021-22 fiscal on higher shipments of petroleum products, engineering goods, gem and jewellery and chemicals. Traders may take note of a survey by the Federation of Indian Chambers of Commerce and Industry (FICCI) stating that India's annual median GDP growth forecast stood at 7.4 percent for 2022-23. Additionally, investments in the Indian capital market through participatory notes (P-notes) rose to Rs 89,143 crore till the end of February, with experts saying the positive trend is likely continue in the coming months on expectations of strong corporate earnings by India Inc which will enthuse foreign investors. Also, according to CMIE data, unemployment rate in the country is decreasing with the economy slowly returning to normal. Fertiliser stocks will be in focus as Fertiliser companies have started passing on a portion of rising input costs to the farmers. There will be some reaction in public sector banks (PSBs) as ICRA said that the government-owned banks that received capital through recapitalisation (recap) bonds may have to take a hit of around Rs 13,000 crore following the Reserve Bank of India’s (RBI’s) directive to recognise these bonds at market value.

The US markets ended higher on Friday despite March’s lower than expected employment report. Asian markets are trading mixed on Monday amid talk of yet more sanctions against Russia over its invasion of Ukraine.

Back home, Dalal Street started the first day of the new financial year (FY23) on a strong note, as both Sensex and Nifty ended Friday’s trading session with gains of over a percent. The markets opened flat with a negative bias on weak global cues but recovered to trade in the positive area throughout the session. Sentiments got a boost with data showing that the output in eight key core sectors rose to a four-month high in February propped up by the low base effect and strong performance in steel, cement, coal, natural gas, refinery products and electricity segments. Sentiments remained positive with Finance Minister Nirmala Sitharaman’s statement that India's digital economy is likely to witness exponential growth to $800 billion by 2030. Investor sentiment was also supported as foreign institutional investors (FIIs) bought shares worth Rs 3,088.73 crore on March 31. Key gauges have enlarged their gains in late afternoon session, taking support from report that the Maharashtra government decided to lift all curbs and restrictions imposed in the state in the wake of Covid 19 from April 2. Traders also got some relief with a labour ministry’s statement that retail inflation for industrial workers eased to 5.04 per cent in February from 5.84 per cent in January this year mainly due to lower prices of certain food items. The street took a note of the finance ministry’s statement that the Union government is looking to raise Rs 8.45 lakh crore through borrowings in the first half of 2022-23 to fund the revenue gap for reviving the economy. Out of the gross market borrowing of Rs 14.31 lakh crore estimated for the next financial year, Rs 8.45 lakh crore is planned to be borrowed in the first half or April-September period. Meanwhile, the data released by the Controller General of Accounts (CGA) has indicated that the Centre's fiscal deficit at the end of February stood at 82.7 per cent of the full year budget target, mainly on account of higher expenditure. In the last financial year, the fiscal deficit or gap between the expenditure and revenue was 76 per cent of the Revised Estimate (RE) of 2020-21. Finally, the BSE Sensex rose 708.18 points or 1.21% to 59,276.69 and the CNX Nifty was up by 205.70 points or 1.18% to 17,670.45.

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