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Indian markets ended over 2 percent lower on Monday dragged by heavy selling in banks, IT, and auto stocks. Today, the start of session is likely to be positive. Traders will be taking support with report that a day after surging past the 150,000-mark, India's count of active cases has dropped to 148,882. On Monday, the country registered 10,792 fresh Covid-19 cases, taking its the caseload tally to 11,015,863. Some support will come as the latest RBI policy minutes show that Governor Shaktikanta Das opined that growth momentum needs to be strengthened for a sustained revival of the economy and quick return to the pre-Covid trajectory while pitching for a status quo on rates. Traders may take note of report that the World Health Organization has agreed on a no-fault compensation plan for claims of serious side effects in people in 92 poorer countries due to COVID-19 vaccines via the COVAX sharing scheme, resolving a big concern among recipient governments. However, there may be some cautiousness as coronavirus cases rise unabated across the globe, with 112,248,996 infected by the deadly contagion. While 87,768,211 have recovered, 2,484,689 have died so far. Besides, Investment through participatory notes (P-notes) in the Indian capital market dipped marginally to Rs 84,976 crore as on January 31 after hitting 31-month high value at the end of the preceding month. Banking sector stocks will be in focus as India Ratings revised its outlook on the overall banking sector from negative to stable for FY22. According to the agency, substantial systemic measures have reduced COVID-linked stress below expected levels. It has also steeply upgraded its credit growth estimates for the current fiscal. Oil & gas and OMC stocks will be in limelight as Petrol and diesel prices on Tuesday touched a new high after state-owned fuel retailers hiked rates after keeping it unchanged for two days in a row. Meanwhile, Heranba Industries' Rs 625 crore IPO would open for subscription today. The price band for the issue has been fixed at Rs 626-627 per share. The firm, on Monday, garnered Rs 187.50 crore from 18 anchor investors ahead of its IPO.

The US markets ended mostly lower on Monday as climbing Treasury yields and prospects of rising inflation triggered valuation concerns, hitting shares of high-flying growth companies. Asian markets are trading mixed on Tuesday as rising US Treasury yields and inflation prospects led to a further rotation out of the big tech stocks responsible for a major Wall Street rally during the pandemic.

Back home, extending their losses for the fifth straight session, Indian equity benchmarks ended with losses of over two percent each on Monday, as weak global cues, rising bond yields, and fears of Covid-19-led lockdown came to haunt the bulls on the Street. After making cautious start, the benchmarks traded with heavy losses, amid reports that ahead of its 'Bharat Bandh' call on February 26, traders' body CAIT wrote to Prime Minister Narendra Modi raising issues related to the GST regime, and alleging violation of e-commerce rules by major e-tailers. In its letter to the prime minister, the Confederation of All India Traders (CAIT) called for setting up of a ‘special working group’ at the central level comprising senior officials, CAIT representatives and independent tax experts to review the GST structure and make recommendations to the government. Key indices extended their downside in second half of trading session to settle near days’ low, as investors remained on sidelines ahead of the macroeconomic data that is GDP print for the December quarter that is slated to be out on Friday, February 26, post-market hours. Sentiments remained down-beat despite report stated that the GST revenue shortfall faced by states is likely to reduce by about Rs 40,000 crore in the current fiscal on improved collections over the past four months. Investors also paid no heed towards Finance Minister Nirmala Sitharaman’s statement that the Union Budget 2021-22 is about the role of government as a facilitator and the private sector as a key driver of economic growth, without which the country would be losing a big opportunity. Meanwhile, Prime Minister Narendra Modi has made a strong case for repealing archaic laws and making it easier to do business in India, stating that the centre and states need to work closely to boost economic growth. Finally, the BSE Sensex fell 1145.44 points or 2.25% to 49,744.32, while the CNX Nifty was down by 306.05 points or 2.04% to 14,675.70.

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