Key equity benchmarks started the first day of financial year 2019-2020 with jubilation, though they ended off their intraday high points. After a firm start, the markets remained positive throughout the session, aided by the Reserve Bank of India's (RBI) data showing that India's foreign exchange reserves continued to surge for the third week in a row, adding $1.029 billion at $406.667 billion in the week to March 22. Traders were optimistic with Chief Economic Advisor Krishnamurthy Subramanian's statement that inflation has remained well under control during the Modi government's tenure, providing relief to the middle class and the poor. Low prices, strong monetary policy framework by the RBI and economic reforms have boosted the domestic consumption in the country. Sentiments also got boost after the goods and services tax (GST) collections scaled record high of Rs 1.06 lakh crore in March, up from Rs 97,247 crore in the previous month, as compliance improved amid increased number of returns filed. Total number of summary sales return GSTR-3B filed for the month of February up to March 31, stood at 75.95 lakh. However, in the last leg of the trade, key indices trimmed their gains, as the RBI said that the country's current account deficit (CAD) widened to 2.5% of Gross Domestic Product (GDP) in Q3FY19 from 2.1% a year ago, primarily due to a higher trade deficit. In absolute terms, India's CAD widened to $16.9 billion in the October-December 2018 quarter against $13.7 billion in the year ago quarter. Adding more worries, credit rating agency, India Ratings and Research (Ind-Ra) in its latest report showed that declining household savings may lead to wider current account deficit (CAD) and rise in the interest rates. Gains also got trimmed, with India's fiscal deficit touching 134.2% of the full-year revised budgeted estimate at the end of February 2019, mainly due to tepid growth in revenue collections. In absolute term, fiscal deficit for April-February 2018-19 was Rs 8.51 lakh crore as against the revised estimate (RE) of Rs 6.34 lakh crore for the entire year. Finally, the BSE Sensex rose 198.96 points or 0.51% to 38,871.87, while the CNX Nifty was up by 45.25 points or 0.39% to 11,669.15.

The US markets ended higher with gains of over a percent on Monday on optimism about US-China trade talks as well as a positive reaction to upbeat US and Chinese manufacturing data. Beijing announced that it will continue to suspend additional tariffs on US vehicles and auto parts after April 1 as a gesture after Washington delayed tariff hikes on Chinese imports. A delegation led by Chinese Vice Premier Liu He is headed to Washington later this week for another round of trade talks. Besides, support also came in after indicating a faster rate of growth in US manufacturing activity in the month of March, the Institute for Supply Management  (ISM) released a report showing an unexpected increase by its index of activity in the sector. The ISM said its purchasing managers index rose to 55.3 in March after falling to 54.2 in February, with a reading above 50 indicating growth in the manufacturing sector. The report said the new orders index climbed to 57.4 in March from 55.5 in February, while the production index ticked up to 55.8 from 54.8. The employment index also surged up to 57.5 in March from 52.3 in February, indicating a notable acceleration in the rate of job growth in the manufacturing sector. The index reached its highest level since November of 2018. Meanwhile, traders largely shrugged off a Commerce Department report showing an unexpected decrease in US retail sales in February, as the report also showed a significant upward revision to the increase in sales in the previous month. The report said retail sales dipped by 0.2% in February after climbing by an upwardly revised 0.7% in January. The unexpected drop in retail sales came despite a rebound in sales by motor vehicle and parts dealers, which increased by 0.7% in February after plunging by 1.9% in January. Dow Jones Industrial Average jumped 329.74 points or 1.27 percent to 26258.42, Nasdaq gained 99.59 points or 1.29 percent to 7828.91 and S&P 500 was up by 32.79 points or 1.16 percent to 2867.19.

Crude oil futures ended higher on Monday on signs of tightening supplies and fading worries over global economic growth. Oil prices remain solidly higher year to date on signs of reduced global supplies on the back of efforts by major oil producers to curb production. Members of the Organization of the Petroleum Exporting Countries (OPEC) and other major oil producers, including Russia, have pledged to curb crude production by around 1.2 million barrels a day from October levels for the first half of this year to prop up markets. Benchmark crude oil futures for May surged $1.45 or 2.4 percent to settle at $61.59 a barrel on the New York Mercantile Exchange. June Brent crude gained $1.43 or 2.1 percent to settle at $69.01 a barrel on London's Intercontinental Exchange.

India's currency market was closed on Monday for annual account closing of banks.

The FIIs as per Friday's data were net buyers in equity segment, while they were net sellers in debt segment In equity segment, the gross buying was of Rs 10168.17 crore against gross selling of Rs 6646.69 crore, while in the debt segment, the gross purchase was of Rs 2504.20 crore with gross sales of Rs 3504.08 crore. Besides, in the hybrid segment, the gross buying was of Rs 2779.43 crore against gross selling of Rs 0.58 crore.

The US markets rose on Monday as strong manufacturing data out of the US and China eased worries of a possible global economic slowdown. Asian markets are trading higher on Tuesday following overnight gains on Wall Street, as concerns over a possible global economic slowdown eased. Indian markets extended their northward journey for third straight session on Monday, with Sensex closing above 39,000 mark for the first time, amid firm cues from Asian peers. Today, the markets are likely to open in green mirroring positive global cues amid easing growth concerns. Investors will be eyeing data of Purchasing Managers' Index (PMI) for manufacturing for March to be out later in the day. Traders will be getting encouragement with report that the Reserve Bank of India (RBI) will again swap up to $5 billion to infuse durable liquidity in the system, a month after the first swaps saw a massive response from banks. Market participants offered up to $16.31 billion against the notified amount of $5 billion in the auction held on March 26. The next auction for three-year tenure will be held on April 23. Some support may also come with a private report that the government has been able to contain its fiscal deficit around 3.4% of the GDP in 2018-2019 by resorting to withdrawals/cash support from public accounts and savings on expenditure. However, there may be some cautiousness with the Commerce Ministry's data showing that the growth of eight core sectors slowed down to 2.1% in February 2019 as compared to 5.4% in February 2018, due to fall in output of crude oil and refinery products. Production of crude oil and refinery products contracted by 6.1%, and 0.8%, respectively, in February. Meanwhile, markets regulator, the Securities and Exchange Board of India (SEBI) has proposed amendments to norms governing Self Regulatory Organisations, including recognising such entities on a nomination basis. There will be some buzz in the banking sector stocks with report that the Reserve Bank of India (RBI) has changed the disclosure norms for banks on material divergences on provisioning, stating that banks will now have to disclose their provisions if the divergence found is more than 10 per cent of the bank's profit before provisioning and contingencies. Besides, rating agency Crisil said that system wide bad loans will improve by 180 basis points to 8.5% in March 2020 from FY19 levels on slower slippages, and the state-run banks will turn profitable for the first time in four years. It added that the banking system will close FY19 with gross non- performing assets of 10.3%. There will be some reaction in auto sector stocks with report that auto majors Maruti Suzuki India, Hyundai and Mahindra & Mahindra reported single digit sales growth in the financial year ended March 31, as slowdown hit passenger vehicles demand for almost nine months of the year.

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

Nifty Top volumes

• L&T is aiming more than $1 billion revenue from its newly launched new-age technology platform L&T Nxt in the next five to seven years. 
• Infosys has completed the formation of a joint venture with Hitachi, Panasonic Corporation and Pasona Inc., strategically enhancing its presence in Japan. 
• ONGC has reported a record 6.5 per cent jump in natural gas production to 25.9 billion cubic meters in the fiscal year ended March 31, 2019. 
• M&M has reported auto sales performance for the financial year ended March 31, 2019 which stood at 6,08,596 vehicles, compared to 5,49,153  vehicles during FY18, registering a growth of 11%.