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Indian markets witnessed profit booking on Friday tracking a global selloff, following a period of record-breaking rallies in recent days. Today, the start of the all-important Budget week is likely to be cautious amid weak cues from global peers and signs of profit-taking in domestic market post the recent bull-run. There will be some cautiousness as the Union government will be presenting the Economic Survey for 2023-24, ahead of the Budget. Finance Minister Nirmala Sitharaman will table the document in both Lok Sabha at 1 PM and Rajya Sabha at 2 PM, followed by a press conference at 2:30 PM. Further, markets today will also assess US President Joe Biden withdrawing from the presidential race, and endorsing Vice President Kamala Harris as the Democratic nominee. However, foreign fund inflows likely to aid domestic sentiments. Foreign investors injected Rs 30,772 crore into Indian equities so far this month, driven by hopes of continued policy reforms, sustained economic growth and a better-than-expected earnings season. Domestic sentiments may get some support as a recent report by the Organisation for Economic Co-operation and Development (OECD) and the Food and Agriculture Organization (FAO) stated that India is likely to have the highest per-capita income growth in the world at 5.4 per cent per annum during 2024-33, allowing it and other emerging economies to drive global consumption of agricultural and fisheries products in the next decade. Some support may also come as the latest monthly payroll data released by the Employees’ Provident Fund Organisation (EPFO) showed that the number of fresh formal jobs created in a month increased to a ten-month high in May, signalling a recovery in the formal labour market in the country. Besides, data shared by the Reserve Bank of India showed India’s forex reserves jumped by $9.69 billion to hit an all-time high of $666.85 billion as of July 12. Some stocks are likely to react to Q1 numbers announced post market hours on Friday. Prominent among these are Reliance Industries, HDFC Bank, UltraTech Cement, Wipro, Paytm and BPCL. There will be some reaction in agriculture related stocks with report that India’s exports of agricultural and process food products in first quarter of FY25 declined by 3.24% to $5.88 billion on-year due to decline rice, cashew and maize shipments. The commerce ministry has identified factors such as the Red Sea crisis causing increase in freight cost, restrictions on rice exports and fall in global price of maize. Meanwhile, four new stocks are slated to list on the bourses today. Prizor Viztech and Sati Poly Plast to list on the NSE SME platform, while Aelea Commodities and Three 3 Paper Board will be listed on the BSE SME platform. In the primary market, SAR Televenture Rs 150 crore and RNFI Services Rs 70.81 crore SME IPOs to open for subscription on the NSE.

The US markets ended in red on Friday as lingering chaos related to a global technical outage caused by a software glitch added uncertainty to an already-anxious market. Asian markets are trading mostly lower on Monday ahead of a packed week of corporate earnings that should test the sky-high valuations of tech stocks, while investors hope a key reading in U.S. inflation will narrow the odds on a September rate cut.

Back home, Indian equity benchmarks failed to carry forward the winning momentum and closed at lowest points of the day on Friday, as investors chose to book profits at record high levels, ahead of Union Budget 2024 amid concerns over the prevailing market valuations. After a flat start, the markets quickly slipped into the red and fell sharply later in the session, due to the global sell-off, triggered by operating system issues that caused devices to crash worldwide. The global IT outrage has led to disruptions in various Indian industries. Traders remained cautious with the Reserve Bank of India (RBI) in its monthly bulletin stating that despite the overall positive trajectory, inflation remains a key concern for the Indian economy as the uptick in June 2024 has derailed its disinflation path. Benchmarks extended their losses during late afternoon deals on across the board sell-off. Traders overlooked Crisil’s report noting that India's exports have shown resilience amidst global challenges, with merchandise exports rising by 5.8% to $109.96 billion in the first quarter of fiscal 2025. Traders also paid no heed towards FICCI’s Economic Outlook Survey stating that Indian economy is expected to grow at an annual median GDP growth of 7 per cent in 2024-25. Traders also shrugged off the think tank Global Trade Research Initiative’s (GTRI) latest report stating that the steps such as increasing exports, making local currency trading workable and a free trade agreement with the Eurasian Economic Union will help boost trade between India and Russia. Finally, the BSE Sensex fell 738.81 points or 0.91% to 80,604.65, and the CNX Nifty was down by 269.95 points or 1.09% points to 24,530.90.

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