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Indian markets ended with solid gains on Friday with robust foreign fund inflows and strong economic data from the U.S. helped ease recession worries. Today, start of the week is likely to be optimistic tracking positive global cues. Foreign fund inflows likely to aid domestic sentiments. According to the provisional data available on the NSE, foreign institutional investors (FII) net bought shares worth net Rs 6,397.13 crore on June 30. Sentiments will get a boost as the India Meteorological Department (IMD) in its forecast for July said most areas in central India, adjoining south peninsula, eastern India, and some parts of Northeast and Northwest India will receive normal rainfall during the month. Some support will come as the Ministry of Finance said India's gross GST revenue collection in June stood at Rs 1,61,497 crore, registering a 12 per cent year-on-year rise. Investors will be looking ahead to the Manufacturing PMI data for more cues. However, some cautiousness may come as data updated by Reserve Bank of India (RBI) showed that India's forex reserves fell $2.9 billion and stood at $593.2 billion as of June 23. Traders may take note of the government data showing that India's core sector grew 4.3% in May, unchanged from April as the drag from slower global growth dented the gains from strong government capital expenditure that lifted key sectors like cement and steel. Besides, the central government’s fiscal deficit stood at Rs 2.1 lakh crore or 11.8 per cent of the full-year budget estimates at May-end 2023. Meanwhile, in order to push capital expenditure by central ministries, the Finance Ministry has extended the relaxed norms on capex in excess of Rs 500 crore to the second quarter of this fiscal. Public sector banking stocks will be in focus as Finance Minister Nirmala Sitharaman said the public sector banks’ (PSBs) profit in the last nine years has tripled to Rs 1.04 lakh crore due to initiatives taken by the government and underlined the need for continuing the momentum to fuel economy. The net profit of PSBs has almost tripled to Rs 1.04 lakh crore in FY23 from Rs 36,270 crore in FY2014.

The US markets ended in green on Friday as investors closed the books on a solid quarter, with data showing progress in the Federal Reserve's efforts to tame inflation. Asian markets are trading mostly higher on Monday as investors digest a slew of manufacturing activity reports from the region.

Back home, continuing their rally for the third consecutive day, Indian equity benchmarks settled at fresh record closing highs on Friday propelled by foreign fund inflows and a firm trend in the global markets. Intense buying in index heavyweights Mahindra & Mahindra, Infosys and Indusind Bank further bolstered sentiment. After the initial uptick, key gauges gradually inched higher as the day progressed as sentiments got a boost with Reserve Bank Governor Shaktikanta Das’ statement that the Indian economy has made a solid recovery and is among the fastest-growing large economies despite heightened uncertainties and formidable headwinds. He said that financial stability is non-negotiable and all stakeholders in the financial system must work to preserve this at all times. Some optimism also came with report that increasing economic ties between India and the US would help boost the country’s exports to America. Markets extended gains in second half of trading session as sentiments remained up-beat with S&P Global Ratings Senior Economist (Asia Pacific) Vishrut Rana’s statement that Indian economy is expected to clock an average growth rate of 6.7 per cent till 2026-27 fiscal driven by domestic consumption. Additional support also came with Reserve Bank of India’s (RBI) bi-annual Financial Stability Report stating that the Indian banking system's asset quality strengthened to a decadal best, with the gross non-performing assets (GNPAs) ratio falling to 3.9 per cent as of March 2023. It said GNPAs of the scheduled commercial banks are expected to improve further to 3.6 per cent by March 2024, as per the baseline scenario. Traders got support after Fitch Ratings said that India's resilient growth outlook will offset a slowdown in overseas markets for the country's corporates and easing input cost pressure will help widen their profit margins. Earlier this month, Fitch had raised India's economic growth forecast to 6.3 per cent for the current fiscal year 2023-24 from the 6 per cent it had predicted previously. Finally, the BSE Sensex rose 803.14 points or 1.26% to 64,718.56 and the CNX Nifty was up by 216.95 points or 1.14% to 19,189.05. 

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