A session after a distressing performance, Indian equity benchmarks consolidated on Friday and ended the volatile day of trade with modest gains. Sentiments got some support with RBI Governor Raghuram Rajan's statement that the ongoing clean-up of bank balance sheets will help spur economic growth and improve the lenders' profitability. He has also said that while the profitability of some banks may be impaired in the short-run, the system, once cleaned, will be able to support economic growth in a sustainable and profitable way. Also, the RBI assured banks that it would inject adequate cash in view of the tight liquidity conditions in the market. Some support also came with Union Minister Venkaiah Naidu expressing confidence that bills pertaining to formation of a realty regulator and the much-awaited indirect taxation reform GST will be passed in the upcoming Budget session, and hoped that Congress will cooperate in ensuring the functioning of Parliament. However, heavy selling by the foreign investors, absence of any fresh positive trigger and below expected third quarter results, halted markets upward movement. In addition, decline in the rupee coupled with a slide in the crude oil prices also kept market-participants on the tenterhooks. Indian rupee weakened by 7 paise to quote at an over 29-month low of 68.37 against the dollar on sustained demand for the American currency from importers and banks. Meanwhile, some investors opted to remain on sidelines ahead of Consumer Price Index (CPI) and Index of Industrial Production (IIP) data scheduled to be released later in the day. On the global front, Asia markets dropped sharply, while European stocks rose Friday. Back home, the local markets got a positive start and moved higher, showing a good pullback after massive sell-off in last session. However, the indices failed to capitalize on the initial momentum and continued to see-saw around the neutral line for most part of morning trades. The selling pressure accentuated in the mid afternoon trades as investors took to across the board risk aversion. However, late short covering in blue-chip stocks and supportive leads from European markets ensured that local bourses go home with small gains. Finally, the BSE Sensex gained 34.29 points or 0.15% to 22986.12, while the CNX Nifty rose 4.60 points or 0.07% to 6,980.95. 

Snapping five days of losing streak, the US markets closed higher on Friday as investors opted to buy beaten down but fundamentally strong stocks after past several sessions' of drubbing. The markets also got some support from a sharp increase by the price of crude oil, with crude for March delivery soaring $3.23 to $29.44 a barrel on optimism about possible production cuts. Amid ongoing oversupply concerns, the price of crude oil tumbled $1.24 in the previous session to a nearly thirteen-year closing low of $26.21 a barrel. Some support also came with report from the Commerce Department showing that U.S. retail sales rose slightly more than expected in January. The retail sales climbed by 0.2 percent in January compared to economist estimates for a 0.1 percent uptick. Meanwhile, a separate report from the University of Michigan showed an unexpected deterioration in consumer sentiment in the month of February. The report said the preliminary reading on the consumer sentiment index for February came in at 90.7 compared to the final January reading of 92.0. The index had been expected to inch up to 92.5. The Dow Jones Industrial Average surged 313.66 points or 2.00 percent to 15,973.84, the Nasdaq gained 70.68 points or 1.66 percent to 4,337.51 while the S&P 500 was up by 35.70 points or 1.95 percent to 1,864.78. 

Crude oil futures surged on Friday, bouncing back from 12-year lows and posting one of the strongest one day moves on record. The prices got a boost with a report that OPEC members are preparing to cooperate on potential production cuts, according to United Arab Emirates' energy minister Suhail bin Mohammed al-Mazrouei. There were reports that OPEC could be moving closer to convening for an emergency meeting that may result in sorely needed production cuts. Benchmark crude oil futures for March delivery ended higher by $3.03 or 11.56 percent to $29.27 a barrel after trading in a range of $26.96 and $29.66 a barrel on the New York Mercantile Exchange. In London, Brent crude for April delivery closed at $33.19, surging by $3.11 or 10.30 percent on the ICE.

Indian rupee ended stronger on the last trading day of the week due to selling of the American currency by banks and exporters. The domestic currency was also supported by the modest gains in equity markets, which despite some choppiness managed a positive close. The currency recouped all its early losses to end stronger. Sentiment further got support with Union Minister Venkaiah Naidu expressing confidence that bills pertaining to formation of a realty regulator and the much-awaited indirect taxation reform GST will be passed in the upcoming Budget session. Meanwhile, investors remained cautious ahead of the Consumer Price Index (CPI) and Index of Industrial Production (IIP) data scheduled to be released later in the day. On the global front, yen was firm against the dollar, as deepening worries about global growth and whether policymakers have enough ammunition to respond to it underpinned flows into safe-haven currencies. Finally, the rupee ended at 68.24, 6 paise stronger from its previous close of 68.30 on Thursday.

The FIIs as per Friday's data were net sellers in equity and in debt segments both. In equity segment, the gross buying was of Rs 2941.98 crore against gross selling of Rs 4151.76 crore, while in the debt segment, the gross purchase was of Rs 595.04 crore with gross sales of Rs 590.03 crore.       

The US markets ended higher in last session, encouraged by the recovery in the crude prices, while there was good retail sales report too that supported the markets snap their losing streak. Most of the Asian markets have made a strong start led by the Japanese market which is higher by over five percent in the early deals as the yen dropped against dollar amid speculation that bear run was excessive. The Chinese market though was in red coming after a long holiday and despite the central bank stepping up efforts to restore stability to the nation's currency and economy. The Indian markets after a volatile trade and recovering from the day's low, snapped the last session modestly in green. Today, the start of the new week is likely to be in good on jubilant global cues. Traders will be getting some support with Prime Minister Narendra Modi's statement that India is the fastest developing country among the “larger economies of the world”. He further said that India is the only economy which has not been affected by the global economic crisis that has hit the world.  Though, traders may react cautiously to the two major macro data of IIP and CPI inflation announced after the market hours on Friday. While, the Industrial output or index of industrial production (IIP) contracted an annual 1.3 percent in December, CPI inflation hit 17-month high in January at 5.69%. Traders will now be eyeing the WPI inflation data slated to be announced later in the day.Meanwhile, the capital goods stocks are likely to see some action on report that the country's first-ever policy for the capital goods sector will be placed before the Cabinet for approval this month. Auto sector stocka are likely to come under pressure on report that passenger car shipments from India declined 18.85 per cent to 33,909 units in January due to challenges in top export markets like Algeria, Europe and neighbouring countries. There will be lots of result reactions too, with PSU banking stocks reacting to the BoB numbers announced during the weekend.

Support and Resistance: NSE Nifty and BSE Sensex

Nifty Top volumes

• Coal India has signed a Memorandum of Understanding with Energy Efficiency Services for implementation of Energy Efficiency projects in the company and subsidiaries.
• Hero MotoCorp has reported 36.51% rise in its net profit at Rs 795.81 crore for the quarter ended December 31, 2015 as compared to Rs 582.98 crore for the same quarter in the previous year.
• Wipro has signed a definitive agreement to acquire HealthPlan Services from Water Street Healthcare Partners, a strategic investor focused exclusively on the health care industry.
• Tata Power has partnered with Toshiba and Cargill to design and develop India's first green, safe and compact natural ester-based pad mount substation.
• Oil & Natural Gas Corporation has reported 64% fall in its net profit at Rs 1285.62 crore for the quarter ended December 31, 2015 as compared to Rs 3571.20 crore for the same quarter in the previous year.