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Indian benchmark indices closed higher by nearly 1 per cent on Monday, ending their two-session losing streak following heavy buying in banking, oil, and FMCG shares. Today, domestic equity markets likely to open in red amid weak global cues and rising crude oil prices. Foreign fund outflows likely to dent sentiments in domestic markets. Foreign institutional investors (FIIs) have net-sold shares worth Rs 538.10 crore on December 19, as per provisional data available on the NSE. There will be some cautiousness as liquidity in the banking system has slipped into a deficit for the first time in three weeks, prompting banks to borrow the largest quantum of funds from the Reserve Bank of India (RBI) in around a month and a half. However, some support may come with a report that bad loans worth Rs 10,09,511 crore have been written off by scheduled commercial banks in the last five fiscals (2017-22). Traders may take note of report that as sanctions-hit Russia increasingly relies on consumer products from India, outbound shipments to Russia have started picking up for the second consecutive month in October. Commerce and industry ministry data showed this comes after it witnessed contraction for six consecutive months starting March. Sugar stocks will be in limelight as industry body ISMA said sugar production has increased 5 per cent to 82.1 lakh tonnes between October 1 and December 15 period of this marketing year, while mills have contracted to export 45-50 lakh tonnes of sweetener. There will be some buzz in coal industry stocks as Union Coal Minister Pralhad Joshi India's coal production will touch one billion tonnes in the next financial year from 900 million tonnes this fiscal ending March, as the country gears up to stop the import of thermal coal by 2024-25. FMCG sector stocks will be in focus with report that India is set to offer 2 to 3 million tonnes of wheat to bulk consumers such as flour millers and biscuit makers as part of efforts to cool record high prices. There will be some reaction in metal stocks with Union minister Jyotiraditya Scindia’s statement that India had become the second-largest steel producer in the world in the last eight years, doubling capacity from 150 to 154 million tonnes of production. Aviation industry stocks will be in action as the latest data from aviation regulator DGCA showed that India's domestic passenger traffic rose 11.06 per cent to 116 lakh in November over the year-ago period. In the primary market, Elin Electronics Rs 475 crore IPO opens for subscription today in the price band of Rs 234 to Rs 247. The issue closes on December 22.

The US markets closed in red on Monday as investors shied away from riskier bets, worried the Federal Reserve's tightening campaign could push the US economy into a recession. Asian markets are trading mostly lower on Tuesday as the People’s Bank of China kept its key lending rates steady.

Back home, Indian equity benchmarks, after two sessions of losses, staged a steady upward march on Monday following heavy buying in Auto, FMCG and Power shares. The indices started on a flat note but caught gaining momentum soon, as data showed foreign investors continued their positive momentum and have injected a net Rs 10,555 crore in Indian equities so far in December amid stabilisation in oil prices and moderating US inflation. Sentiments also got boost as the gross direct tax collections have grown 26 per cent to over Rs 13.63 lakh crore so far this fiscal, aided by TDS deductions and healthy corporate advance tax mop-up. Some optimism also came as data released by the Reserve Bank showed that India’s forex reserves rose by $2.908 billion to $564.06 billion for the week ended on December 9. Indian frontline indices extended gains in second half of trading session, as sentiments remained positive with Textile Minister Piyush Goyal’s statement that countries across the world are looking at India as a trusted partner and want to sign free trade agreements with it after its emergence as a strong force in the world. Some optimism also came with report that the Department for Promotion of Industry and Internal Trade (DPIIT) is working closely with 24 sectors in order to boost domestic manufacturing, increase exports and cut down imports. It said efforts are on to boost the growth of these sectors in a holistic and coordinated manner. Traders overlooked Icra Ratings' report that with exports continuing to remain under stress for the second consecutive month in November, and imports also falling, the current account deficit is likely to moderate in the second half and close the fiscal with a 3.3 percent of GDP or $108-112 billion, which still be a record high. Finally, the BSE Sensex rose 468.38 points or 0.76% to 61,806.19 and the CNX Nifty was up by 151.45 points or 0.83% to 18,420.45.