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Indian markets ended flat on Monday tracking mixed global cues after robust U.S. jobs data released on Friday stirred anxiety over the pace of future rate increases. Today, markets are likely to make negative start tracking weak global cues. Besides, investors will track the Reserve Bank of Australia’s policy decision today. It is expected to deliver a 25 bps rate hike. Back home, market participants will also keep eye on election exit poll results across Gujarat and Himachal Pradesh. Foreign fund outflow likely to dent sentiments in domestic markets. Provisional NSE data showed foreign institutional investors (FIIs) sold Rs 1,139.07 crore worth of shares on December 5. However, some support may come with a private report that India’s central bank will probably start slowing the pace of interest-rate increases on Wednesday, signaling it’s near the end of its aggressive tightening cycle. Traders may take note of another private report that the Unified Payments Interface (UPI), debit and credit cards, prepaid payment instruments like mobile wallets, and prepaid cards logged 23.06 billion transactions amounting Rs 38.3 lakh crore in the third quarter this year. Meanwhile, the GST Council in its next meeting is likely to discuss decriminalisation of offences under GST law, along with raising the threshold of launching prosecution to Rs 20 crore, from Rs 5 crore at present. There will be some buzz in power stocks as aggregate technical and commercial (AT&C) losses of power distribution utilities declined to 17 per cent in 2021-22 from 22 per cent in the previous year. Power ministry said reduction in AT&C losses improves finances of utilities (discoms), enabling them to better maintain the system and buy power as per requirement and benefit the consumers. Sugar stocks will be in focus with a private report that India's sugar output is likely to fall 7% this year as erratic weather conditions have cut cane yields, which could dampen exports from the world's biggest producer of the sweetener.

The US markets ended lower on Monday as investors spooked by better-than-expected data from the services sector re-evaluated whether the Federal Reserve could hike interest rates for longer. Asian markets are trading mostly in red on Tuesday after Wall Street sold off overnight on fears that the Fed will keep increasing interest rates.

Back home, in an extremely volatile session, Indian benchmark indices recouped most of losses to close flat on Monday as investors remained on sidelines and deferred from making any large moves ahead of RBI Monetary Policy Committee meeting outcome. The outcome of the meeting will come on December 07. There are expectations that the Reserve Bank of India MPC is likely to announce a 35 basis points (bps) rate hike. After making cautious start, key gauges fell sharply even as report stated that after pulling out money from Indian equities market in the past two months, Foreign Portfolio Investors (FPIs) made a strong come back in November with a net investment of Rs 36,329 crore on weakening of the US dollar index and positivity about overall macroeconomic trends. However, key gauges erased losses in early afternoon deals, as traders found some support with Economic Advisory Council member Sanjeev Sanyal’s statement that India is capable of sustaining an economic growth of 9 per cent for many years, even as he asserted that a high sustained GDP growth rate is key for the world to achieve the 2030 Sustainable Development Goals (SDGs). But, markets failed to hold recovery and once again fell sharply in late afternoon session despite the Reserve Bank of India's (RBI) weekly statistical supplement showed India's foreign exchange reserves rose for the third straight week, to $550.14 billion in the week through November 25. For the week ended November 18, the country's reserves were at $547.25 billion. However, a strong services activity reading helped Indian shares to stage recovery in the last leg of the trade. As per the survey report, India’s services sector witnessed strong growth in the month of November, as business activity and sales rose at faster rates. The seasonally adjusted S&P Global India Services PMI Business Activity Index surged to 56.4 in November from 55.1 in October. Further, the S&P Global India Composite PMI Output Index -- which measures both manufacturing and services -- improved to 56.7 in November from 55.5 in October. Finally, the BSE Sensex fell 33.90 points or 0.05% to 62,834.60 and the CNX Nifty was up by 4.95 points or 0.03% to 18,701.05.

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