Bears took full control on Dalal Street on Monday, as both the larger peers, the Sensex and the Nifty, closing lower by around 800 and 250 points, respectively. The markets made a negative start of the day, amid reports that foreign institutional investors (FIIs) sold shares worth Rs 89 crore on a net basis in the cash market, while domestic institutional investors (DIIs) bought shares worth Rs 276 crore. Anxiety remained among the market participants, as India Meteorological Department (IMD) data report showed that monsoon has covered almost the entire country, but three-fourths of MeT department's sub-meteorological divisions still fall under the deficient rainfall category. In the second half of the session, bears tighten their grip, on account of weak cues from European markets. Domestic sentiments remained pessimistic with Moody's report that there are risks of India missing 3.3 percent fiscal deficit target for the current financial year if tax revenue falls short of the projection. The Budget 2019-20 lowered fiscal deficit projection for the current financial year to 3.3 percent from 3.4 percent targeted in the Interim Budget 2019-20 in February. The street overlooked Secretary in the DPIIT, Ramesh Abhishek's statement that the initiatives announced by the government for start-ups in the Union Budget would significantly improve the flow of funds and encourage budding entrepreneurs. Finally, the BSE Sensex lost 792.82 points or 2.01% to 38,720.57, while the CNX Nifty was down by 252.55 points or 2.14% to 11,558.60.

The US markets ended lower for second straight session on Monday amid waning optimism about a near-term interest rate cut following last Friday's much better than expected jobs data.. The Labor Department's closely watched report had showed employment jumped by 224,000 jobs in June compared to expectations for an increase of 160,000 jobs. Though, traders continue to look for the Federal Reserve to cut rates when policy makers meet at the end of the month. Lower interest rates make it cheaper for companies to borrow and are thus bullish for stocks. A notable drop by Apple (AAPL) also weighed on the markets, with the tech giant tumbling by 2.1 percent. Fellow Dow component Boeing (BA) also fell by 1.3 percent after Saudi Arabia's flyadeal became the first airline to officially cancel an order for the beleaguered aerospace giant's 737 MAX aircraft. However, in light of the focus on the outlook for rates, overall trading activity was somewhat subdued ahead of Fed Chairman Jerome Powell's congressional testimony later this week. Powell is due to testify before the House Financial Services Committee on Wednesday and before the Senate Banking Committee on Thursday. Powell's testimony comes after a stronger-than-expected jobs report raised questions about whether the Fed will cut rates later this month. Besides, Wednesday will also see the release of the minutes of the Fed's last monetary policy meeting, which may shed additional light on the central bank's decision to make notable changes to its accompanying statement. Dow Jones Industrial Average slipped 115.98 points or 0.43 percent to 26806.14, Nasdaq declined 63.41 points or 0.78 percent to 8098.38 and S&P 500 was down by 14.46 points or 0.48 percent to 2975.95.

Crude oil futures ended slightly higher on Monday as tensions with Iran, and the possibility of disruptions to oil flow in the Middle East, increased. The decision of the Organization of Petroleum Exporting Countries (OPEC) and its key allies including Russia, to extend crude output cuts by nine months until March 2020 continued to support oil prices. A smaller than expected drop in US crude inventories in the week ended June 28 also supported oil prices. Meanwhile, there are still concerns about the outlook for energy demand due to economic slowdown and continued uncertainty about China and the US agreeing on a long term trade deal. Benchmark crude oil futures for August gained 15 cents or 0.3 percent to settle at $57.66 a barrel on the New York Mercantile Exchange. However, September Brent fell 12 cents or 0.2 percent to settle at $64.11 a barrel on London's Intercontinental Exchange.

Indian rupee ended lower against US dollar on Monday on account of sustained demand for dollar from banks and importers. Sentiments remained down-beat with Moody's stating that there are risks of India missing 3.3 percent fiscal deficit target for the current financial year if tax revenue falls short of the projection. The Budget 2019-20 lowered fiscal deficit projection for the current financial year to 3.3 percent from 3.4 percent targeted in the Interim Budget 2019-20 in February. Additionally, a firm dollar against some global currencies overseas along with a sharp sell-off in the domestic stock market pressurized the sentiment. On the global front, dollar rose broadly on Monday after strong US jobs growth in June suggested the Federal Reserve will not aggressively cut interest rates later this month. Finally, the rupee ended at 68.66, 24 paise weaker from its previous close of 68.42 on Friday.

The FIIs as per Monday's data were net buyers in equity and debt segments both. In equity segment, the gross buying was of Rs 4245.88 crore against gross selling of Rs 3646.29 crore, while in the debt segment, the gross purchase was of Rs 2937.26 crore with gross sales of Rs 958.68 crore. Besides, in the hybrid segment, the gross buying was of Rs 2.76 crore against gross selling of Rs 6.71 crore.

The US markets declined on Monday as dimming prospects that the Federal Reserve will cut interest rates anytime soon weighed on equities. Asian markets are trading mixed on Tuesday following overnight fall on Wall Street. Indian markets extended their losses for second straight session on Monday dragged by losses in index heavyweights HDFC Bank, L&T and Bajaj Finance, amid heavy selloff in global equities. The indices reported their biggest one-day fall in 2019. Today, the markets are likely to make a cautious start amid weak global cues and ahead of first quarter (April-June) results. IT major Tata Consultancy Services (TCS) will report its numbers later in the day. There will be some cautiousness with CARE Ratings' report that economic slowdown has begun to dent the credit profile of India Inc. There has been a deterioration in the credit quality of entities rated in the first quarter of the current financial year, showing effect of the prevailing slowdown in the Indian economy. It added that the credit rating downgrades have been largely on account of liquidity pressure leading to, at times, delays in debt servicing, high debt levels, weakening profit margins, decline in scale of operations. However, some support may come later in the day with the Reserve Bank of India (RBI) Governor Shaktikanta Das' statement the financial system is hugely surplus with liquidity and this would facilitate the better transmission of rate cuts implemented by the RBI. Besides, P C Mody, chairman of the Central Board of Direct Taxes (CBDT), has said the government will soon issue a clarification on the increase in the tax rate on foreign portfolio investors to allay their concerns. Traders may took note of the Governor Shaktikanta Das' statement that the central bank will discuss with the government the issuance of overseas sovereign bonds, an instrument that will help reduce dependence on the domestic market for bridging fiscal deficit. The RBI issues bonds on behalf of the government as part of the resource mobilisation exercise to fund gap between revenue and expenditure. There will be some buzz in the telecom stocks with report that regulator Trai has stuck to its recommendation on base price and valuation of the spectrum, including for 5G radiowaves, making it clear to the telecom department that it has considered all relevant factors while giving views on prices. There will be some reaction in metal stocks with report that the country's finished steel imports rose 4.7 percent to 7.83 million tonne (MT) in 2018-19. 

Support and Resistance: NSE (Nifty) and BSE (Sensex)

Nifty Top volumes

• IndusInd Bank has launched IndusInd Bank Celesta American Express Credit Card. 
• HDFC Bank has registered around Rs 9,545 billion deposits as of June 30, 2019 as compared to Rs 8,058 billion as of June 30, 2018 and Rs 9,231 billion as of March 31, 2019. 
• Tata Motors is committed to leading the transition towards electric mobility in the country and the company looks to closely work with other group entities to create a viable environment for green vehicles. 
• Dr Reddy's Laboratories is planning to launch several value-added products this fiscal in the US market to offset the persisting problem.