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Indian markets ended sharply lower on Friday as investors preferred to book profit amid uncertainty over the US Fed rate cut timing, start of the Q4 earnings season. Today, markets are likely to get negative start of the holiday-shortened week amid weak global cues as well as higher global crude oil prices. Oil prices are likely to rise further after Iran's attack on Israel over the weekend, but further gains may depend on how Israel and the West choose to retaliate. Traders will be also concerned with a private report that exporters are in a wait-and-watch mode as they expect air freight volume to Europe to rise 10-15%, logistics and insurance costs to rise and engineering exports demand to Europe to get impacted following Iran's attack on Israel. However, positive macro-economic data may support the domestic indices later in the day. The government data showed that India's retail inflation eased to 4.85 per cent on an annual basis in March as against 5.09 per cent in the previous month. Also, data provided by the Ministry of Statistics and Programme Implementation (MoSPI) showed that the Index of Industrial Production (IIP) in India rose 5.7 per cent in February as against 3.8 per cent in January. IIP in December 2023 was recorded at 4.2 per cent. Some support may also come as the RBI said India’s forex reserves jumped by $2.98 billion to a fresh peak of $648.562 billion for the week ended April 5. In the previous reporting week, the forex kitty had increased by $2.951 billion to $645.583 billion, which was an all-time high. There will be some reaction in aviation industry stocks with Icra’s report that domestic air passenger traffic is likely to have witnessed an annual growth of 13 per cent at around 15.4 crore in 2023-24 and the aviation industry's net loss is expected to have declined to Rs 3,000 to 4,000 crore during the same period. It also said the airlines' ability to raise yields proportionate to their input cost increases will be key to expand their profitability margins while supply chain challenges and engine failure issues pose near term headwinds. Investors will be looking ahead to the March quarter (Q4FY24) results of GTPL Hathway, Hathway Bhawani Cabletel & Datacom, Metalyst Forgings, Ontic Finserve, Rajoo Engineers, Hit Kit Global Solutions, Shekhawati Poly-Yarn, Atam Valves, and Sybly Industries. Besides, TCS, IT major reported a net profit of Rs 12,434 crore, up 9.1 per cent year-on-year (Y-o-Y) on Friday post market hours.

The US markets ended lower on Friday amid fears of an imminent attack by Iran over Israel. Asian markets are trading mostly in red on Monday after China's central bank left a key policy interest rate unchanged as widely expected when rolling over maturing medium-term loans.

Back home, Indian equity benchmarks ended lower by over a percent on Friday as investors preferred to book profit amid uncertainty over the US Fed rate cut timing and start of the Q4 earnings season. Benchmarks made a negative start and stayed in red for whole day as traders remained cautious with a private report that India's consumer price inflation likely eased to a five-month low of 4.91% in March but was still above the Reserve Bank of India's 4% medium-term target as food price rises persist. Traders overlooked Reserve Bank of India’s (RBI) Monetary Policy Report stating that the government's continued emphasis on infrastructure creation, coupled with an uptick in private corporate investment and buoyant business optimism, could nurture a sustained revival in the investment cycle, which augurs well for boosting productivity and growth in the economy. Traders also paid no heed towards report that the Asian Development Bank (ADB) raised India's GDP growth forecast for the current fiscal to 7 per cent from 6.7 per cent earlier, saying the robust growth will be driven by public and private sector investment demand and gradual improvement in consumer demand. Markets extended losses in second half of trading session, as some concern came amid a private report stating that the growing Indian economy is creating jobs, but mainly for the unskilled and semi-skilled workers. Graduates and those having higher qualifications, even with technical degrees and diplomas, are witnessing employment generation at a slow pace. Also, traders remained on sidelines ahead of the India’s Consumer Price Index (CPI) inflation and Index of Industrial Production (IIP) data to be out later in the day. Traders took a note of report that global rating agency Moody's has affirmed India's outlook at Baa3 and P-3, signaling stability. However, it has issued a warning that escalating political tensions or further weakening of checks and balances could harm the country's long-term growth trajectory. Finally, the BSE Sensex fell 793.25 points or 1.06% to 74,244.90 and the CNX Nifty was down by 234.40 points or 1.03% points to 22,519.40. 

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