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Indian markets managed to end Wednesday's highly volatile session with decent gains as heavyweights Reliance Industries, ICICI Bank, HDFC Bank and HCL Tech lent support in the fag end. Today, markets are likely to make flat-to-positive start tracking gains in global markets and ahead of the weekly F&O expiry. Trading activity likely to remain subdued due to the beginning of the corporate earnings season after market hours. India’s top IT firms will kick off December quarter earnings, with TCS and Infosys to report numbers later in the day. The Street expects IT companies’ third quarter (Q3) earnings to remain subdued because of seasonal furloughs and continued cuts in discretionary spending by clients. Sentiments will get a boost as Finance Minister Nirmala Sitharaman said India will become the third largest economy by 2027-28, with a GDP of over $5 trillion. Some optimism will come as a PHDCCI report noted that India's economy is likely to surpass $4 trillion in 2024-25 and further escalate to $5 trillion by 2026-27. The industry chamber also expects the RBI to cut the repo rate by 100 basis points in a calibrated manner by the end of 2024. Observing that despite global challenges, India's economy remains resilient, the report said the country is poised to attain the status of a developed economy by 2047 under the initiative of 'Viksit Bharat'. Some support will come as State Bank of India chairman Dinesh Kumar Khara termed the 7.3 per cent growth estimate for the country for FY24 as a very positive development. Traders may take note of Foreign Secretary Vinay Kwatra’s statement that India and the United Arab Emirates have signed a deal to explore the establishment of grid connectivity between the two countries. Kwatra said the deal is part of a total of four memorandums of understanding signed between New Delhi and Abu Dhabi in the ongoing Vibrant Gujarat Global Summit. He said one of the pacts is on renewable energy, which also includes green hydrogen and solar. However, foreign fund outflows may dampen sentiments. Provisional data from the NSE showed that foreign institutional investors (FIIs) sold shares worth Rs 1,721.35 crore on January 10. Meanwhile, India has imposed anti-dumping duties on three Chinese products -- wheel loaders, gypsum tiles, and industrial laser machinery -- for five years to guard local manufacturers from cheap imports from the neighbouring country. There will be some reaction in stocks related to coal industry as the National Coal Index (NCI) dropped 17.54 per cent to 155.09 points in November 2023 indicating sufficient coal availability in the market. The NCI was at 188.08 points in November 2022. This shows a strong supply of coal in the market, with sufficient availability to meet the growing demand.

The US markets ended higher on Wednesday ahead of key inflation readings and bank earnings. Asian markets are trading mostly in green on Thursday with Japan's Nikkei extending its record-breaking rally on dovish BOJ bets.

Back home, Indian equity benchmarks ended the volatile day of trade near intraday high levels as bulls rejuvenate in late hour. Markets made a cautious start traded in green and red for most part of the day ahead of earnings of IT majors as well as key economic indicators like retail inflation and factory production for directional cues. Market participants remain concerned with a private report that India's retail inflation likely edged up in December on higher food prices but stayed within the Reserve Bank of India's target range for a fourth consecutive month. Investors also got anxious with report stating that the weighted average rates of state debt continued to remain at an over two-year high of 7.72 per cent at the second weekly auction of the quarter on Tuesday, making it the highest so far this fiscal. At the same time, traders took support with foreign brokerage report stating that the Indian economy is likely to grow at 6.2 per cent in the next fiscal, mainly due to the favourable combination of neutral policy settings, positive credit momentum, and manageable macros amid a 15-year high household debt levels. Sentiments also got support with World Bank’s report where it is in its Global Economic Prospects report retained India’s economic growth forecast at 6.3% for the current financial year (FY24). It said India is anticipated to maintain the fastest growth rate among the world’s largest economies, but its post-pandemic recovery is expected to slow. It added that growth is then expected to recover gradually, edging up to 6.4% in FY2024-25 and 6.5 percent in FY2025-26. But, rally which took place in last leg of trade mainly helped markets to end near intraday highs. Traders turned optimistic, as Prime Minister Narendra Modi said that all major rating agencies are of the opinion that India will be among three largest economies in the world in next few years. Some support also came with a private report stating that the IPO and deal-making activities are likely to be brisk this year and may even surpass the record set in 2021 with around $50 billion funds being raised across equity issuances and deals. Finally, the BSE Sensex rose 271.50 points or 0.38% to 71,657.71 and the CNX Nifty was up by 73.85 points or 0.34% to 21,618.70.

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