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Indian markets ended sharply lower on Monday tracking weak global cues as investors fretted about the impact of high inflation and aggressive policy tightening on global growth. Today, start of session is likely to be optimistic tracking firm global cues. Traders will be taking encouragement as Crisil Ratings said that India Inc's credit quality showed further improvement in April-September period with the ratio of upgrades to downgrades inching higher. Crisil Ratings, which rates 6,800 companies, added that the credit ratio's improvement to 5.52 in H1FY23 as compared to 5.04 in H2FY22 was driven by leaner balance sheets led by healthy cash flows and muted investments. Also, Icra Ratings said credit quality of corporates has strengthened further in the first half of the current fiscal with rating upgrades being more than three times that of downgrades, carrying on with the momentum since early FY22. However, some cautiousness may come as the United Nations Conference on Trade and Development (UNCTAD) said India's economic growth is expected to decline to 5.7 per cent this year from 8.2 per cent in 2021, citing higher financing cost and weaker public expenditures. According to the forecast by the UNCTAD Trade and Development Report 2022, India's GDP will further decelerate to 4.7 per cent growth in 2023. Traders may be concerned as the preliminary data released by the commerce ministry showed that India's exports contracted by 3.52% to $32.62 billion in September against $33.81 billion in the same month last year, while the trade deficit widened to $26.72 billion. Besides, the average cost of market borrowing for states rose 12 basis point to 7.77 per cent on Monday, increasing for the third consecutive week. Meanwhile, capital markets regulator Sebi has cautioned investors against unauthorised money mobilisation by entities claiming to provide portfolio management services. Further, the regulator noted that these entities have been luring the public, with a promise of high returns, through pamphlets and social media platforms. There will be some buzz in platinum related industries stocks as the Finance Ministry said import duty on platinum has been increased to a total of 15.4 per cent with effect from October 03, 2022. Sugar industry stocks will be in focus with a private report that the government will likely cut the sugar export quota by 29% for the new marketing year that started on October 1 to keep domestic supplies steady. There will be some reaction in fertilizer stocks as with fall in global prices, fertiliser companies are looking to import phosphoric acid at not more than $1,000-1,050 per tonne -- around 40 per cent cheaper than the price quoted by global suppliers in the September quarter. In the primary market, the Rs 500-crore IPO of consumer durables player Electronics Mart India will open for subscription today and close on October 07. The price band for the issue has been fixed at Rs 56-59 per share.

The US markets ended higher on Monday as US Treasury yields tumbled on weaker-than-expected manufacturing data, increasing the appeal of stocks at the start of the year's final quarter. Asian markets are trading in green on Tuesday after stocks on Wall Street rallied overnight.

Back home, a heavy selling dragged Indian equity markets in red on Monday, with both Sensex and Nifty closing lower by over 1%. After a weak start, markets remained negative for the entire day, as weak economic data dampened the sentiments in the markets. The government data showed that the output of eight core infrastructure sectors grew 3.3 per cent in August -- the lowest in nine months -- as against 12.2 per cent in the year-ago period. More pessimism came as foreign investors turned sellers again in September and pulled out over Rs 7,600 crore from the Indian equity markets amid hawkish stance by the US Fed and sharp depreciation in rupee. However, some recovery witnessed over the Dalal Street in late morning deals, as the gross Goods and Services Tax (GST) collections surged 26% in the month of September 2022 at Rs 1,47,686 crore over the same month last year. Out of total, CGST is Rs 25,271 crore, SGST is Rs 31,813 crore, IGST is Rs 80,464 crore (including Rs 41,215 crore collected on import of goods) and Cess is Rs 10,137 crore (including Rs 856 crore collected on import of goods).  Besides, the Finance Ministry will run a special financial inclusion drive from October 15 to achieve saturation in respect of bank accounts and expansion of Kisan Credit Card coverage, among others. Indices failed to hold recovery & witnessed a sharp fall in the last hours of trade. Sentiments were pessimistic, after India's manufacturing activity lost some momentum in September, but cost pressures continued to recede. According to the S&P Global's Purchasing Managers' Index, the S&P Global India Manufacturing PMI edged down to 55.1 from 56.2 in August. Besides, the latest data on public debt showed that the total liabilities of the government increased to Rs 145.72 lakh crore at the end-June 2022 from Rs 139.58 lakh crore at end-March 2022. Traders overlooked a report by the Reserve Bank of India (RBI) stating that the retail inflation may come down to 5.2% in the next fiscal beginning April 2023. Finally, the BSE Sensex declined 638.11 points or 1.11% to 56,788.81 and the CNX Nifty was down by 207.00 points or 1.21% to 16,887.35.

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