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Indian markets after touching new heights in the early deals settled flat with a positive bias on Monday as investors avoided to take any long position ahead of FED chair testimony. Today, markets are likely to get a cautious start amid weak cues from global markets. Investors will be eyeing HSBC Services PMI data to be out later in the day for more directional cues. Foreign fund outflows likely to dent Sentiments. Foreign institutional investors (FIIs) net sold shares worth Rs 564.06 crore on March 4, provisional data from the NSE showed. However, some support will come with a private report that Inflation may decline for two years in a row. As per the report, inflation is likely to fall to 4.3 per cent in the financial year 2024-25 from 5.4 per cent in the financial year 2023-24. Traders may take note of a report released by the National Statistical Office (NSO) showing that India’s unemployment rate dropped to 3.1 per cent in 2023 from 3.6 per cent in the preceding year, reflecting continued improvement in the labour markets. During the calendar year 2023 (CY23), the unemployment rate in both rural and urban areas declined to 2.4 per cent and 5.2 per cent, respectively, from 2.8 per cent and 5.9 per cent in 2022. Sugar industry stocks will be in limelight as industry body ISMA said the country's sugar production declined 1.19 per cent to 25.53 million tonne so far in the ongoing 2023-24 marketing year. Sugar production stood at 25.84 MT till February in the year-ago period. Sugar marketing year runs from October to September. There will be some reaction in aviation industry stocks as the Ministry of Civil Aviation's data showed that the average daily domestic air traffic jumped by 3.78 per cent month-on-month (MoM) to 439,464 passengers in February. The Street will also see two new stock debuts. Exicom Tele Systems and Platinum Industries will get listed against their issue prices of Rs 142 and Rs 171, respectively. 

The US markets ended lower on Monday backing away from record highs, while US Treasury yields ticked higher as investors looked ahead to key jobs data and Federal Reserve Chair Jerome Powell's congressional testimony later in the week. Asian markets are trading mostly in red on Tuesday after China set out an economic growth target of around 5 per cent for 2024, which was largely in-line with expectations.

Back home, Indian equity benchmarks trimmed initial gains to close marginally higher in a highly volatile trade on Monday. Markets made a slightly positive start and managed to keep their heads above water for the most part of the session as traders took some support with private report that Inflation in goods and services other than fuel and food is likely to remain low, around 3% in the near term, owing to weak rural demand, softness in housing inflation and lower input cost pressures. Some solace also came as Moody's raised India's growth forecast for 2024 calendar year to 6.8 per cent, from 6.1 per cent estimated earlier, on the back of 'stronger-than-expected' economic data of 2023 and fading global economic headwinds. However, gains remained capped as provisional data from the NSE showed foreign institutional investors (FIIs) net sold shares worth Rs 81.87 crore on March 2, 2024. Traders took a note of Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) member Ashima Goyal’s statement that the Indian economy has done well despite multiple external shocks, but counter-cyclical macroeconomic policy measures will be required to aid the economy's natural resilience as geopolitical situation remains fragile. Goyal further said inflation in the country has come down but it has not yet reached the target levels. Finally, the BSE Sensex rose 66.14 points or 0.09% to 73,872.29 and the CNX Nifty was up by 27.20 points or 0.12% to 22,405.60.

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