Thursday turned out to be a fabulous day for Indian markets, as Sensex & Nifty logged gains of around 300 & 100 points, respectively. The start of the day was firm, aided with the commerce & industry ministry data showing that foreign direct investment into India grew 15% to $26 billion during the first half of the current financial year. Inflow of FDI during April-September of 2018-19 stood at $22.66 billion. Adding more comfort, Goods & Services Tax revenue collection remained above Rs 1 lakh crore mark for the second month in a row with December mop-up rising to Rs 1.03 lakh crore as compared to the year-ago period. Bulls held their tight grip over the markets for the whole day, after Indian manufacturing industry saw a solid rise in their activities in the month of December 2019, on account of rising new orders and output. As per the survey report, the Nikkei India Manufacturing Purchasing Managers' Index surged to 52.7 in December from 51.2 in November. Traders remained positive with a private report stating that private equity investments in the country are expected to grow 15-20 per cent in 2020 as investors pin hopes on the country's long growth potential after a blockbuster year when credit flow through regular channels turned slow. Finally, the BSE Sensex gained 320.62 points or 0.78% to 41,626.64, while the CNX Nifty was up by 99.70 points or 0.82% to 12,282.20.

Extending the substantial upward move seen last year, the US markets ended at new record highs on the first trading day of 2020. Traders continued to express optimism about the potential impact of a phase one US-China trade deal, with President Donald Trump saying the deal is due to be signed during a White House ceremony on January 15. Trump said on Tuesday that he would travel to Beijing at a later date to begin talks on phase two of a trade agreement. Recent reports have indicated Chinese Vice Premier Liu He, Beijing's top trade negotiator, will be on hand to sign the phase one deal. The US economy has held up relatively well in the face of the US-China trade war, and the signing of the phase one deal could lift some of the lingering uncertainty hanging over some industries. Financial markets in the US were closed Wednesday for New Year's Day. The Labor Department released a report showing initial jobless claims unexpectedly edged slightly lower from an upwardly revised level in the week ended December 28. The report said initial jobless claims slipped to 222,000, a decrease of 2,000 from the previous week's revised level of 224,000. Street had expected jobless claims to inch up to 225,000 from the 222,000 originally reported for the previous week. Besides, sentiments were lifted after the People's Bank of China lowered the amount of reserve cash the country's banks must hold, which will put more money into the economy. This move will inject about 800 billion yuan in liquidity to the Chinese economy.

Crude oil futures ended higher on Thursday as traders eyed developments in the Middle East and weighed prospects for crude supply disruptions in the region. Oil Prices traded higher, following an attempt by supporters of Iran-backed militias to storm the US Embassy on Tuesday. Protesters subsequently withdrew from the area. The US took steps to boost security at the embassy, sending Marines from neighboring Kuwait and moving to deploy an infantry battalion of around 750 solders to the region. Besides, oil prices also found some support after China's central bank said that it would provide a further shot of stimulus to the economy, which may boost the potential for energy demand. Crude oil futures for February added 12 cents or 0.2 percent to settle at $61.18 a barrel on the New York Mercantile Exchange. March Brent gained 25 cents or 0.4 percent to settle at $66.25 a barrel on London's Intercontinental Exchange.

Indian rupee ended weaker against the American currency on Thursday, amid sustained rise in crude oil prices and foreign fund outflows. Sentiments remained down-beat despite Indian manufacturing industry saw a solid rise in their activities in the month of December 2019, on account of rising new orders and output. As per the survey report, the Nikkei India Manufacturing Purchasing Managers' Index (PMI) - a composite single-figure indicator of manufacturing performance -surged to 52.7 in December from 51.2 in November. A strengthening US dollar against major global currencies also affected rupee's trading pattern, while an encouraging rally in domestic equities kept the downside in check. On the global front, dollar snapped a six-day losing streak to add 0.2 per cent on Thursday, the first trading day of 2020, pushing the euro off five-month highs while the offshore yuan shrugged off reserve ratio cuts that could add $115 billion worth of liquidity. Finally, the rupee ended at 71.38, 16 paise weaker from its previous close of 71.22 on Wednesday.

The FIIs as per Thursday'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 722.07 crore against gross selling of Rs 363.04 crore, while in the debt segment, the gross purchase was nil with gross sales of Rs 1.45 crore .Besides, in the hybrid segment, the gross buying was of Rs 2.46 crore against gross selling of Rs 0.03 crore.

The US markets ended at record highs on Thursday as traders continue to express optimism about the potential impact of a phase one US-China trade deal. Asian markets are trading mostly in green on Friday following overnight gains on Wall Street. Indian markets ended higher on Thursday led by a surge in metals and infrastructure stocks, amid expansion in manufacturing activity to a 7-month high in December. Today, the markets are likely to make a cautious start amid reports of surge in crude oil prices. As per reports, oil prices jumped more than $1 on Friday after a US airstrike killed key Iranian and Iraqi military personnel, raising concerns that escalating Middle East tensions may disrupt oil supplies. There will be some cautiousness with another private report indicating that India's real GDP growth would weaken further in Q3 of the financial year due to slow economic activity in the first two months of the second half and the GDP for FY20 could be around 4.5%. Besides, think-tank Centre for Monitoring Indian Economy (CMIE) stated that India's unemployment rate increased to 7.7% in December, slightly higher than 7.48% reported in the previous month. However, some support may come later in the day with report that the Reserve Bank of India (RBI) on January 6 will carry a special simultaneous open market operation to buy and sell government bonds of Rs 10,000 crore each. On a review of the current liquidity and market situation and an assessment of the evolving financial conditions, the RBI has decided to conduct simultaneous purchase and sale of government securities under Open Market Operations (OMO). Traders may take note of the RBI's report that banks' credit and deposits grew by 7.10 percent and 10.09 percent to Rs 99.47 lakh crore and Rs 130.08 lakh crore in the fortnight ended December 20. There will be some buzz in the infrastructure stocks as ratings agency ICRA maintained a cautious stance on the road sector, even as the government has decided to invest Rs 102 lakh crore from fiscal 2020-2025 in modernising infrastructure. There will be some reaction in sugar stocks with Indian Sugar Mills Association's (ISMA) statement that the country's sugar production has fallen sharply by 30.22% to 7.79 million tonne in the first three months of current marketing year ending September, but ex-mill prices have remained stable so far, helping mills clear cane payment to farmers on time.

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

Nifty Top volumes

• Tata Motors has reported domestic sales of 44,254 units for December 2019, as compared to 50,440 units for December 2018, posting a decline of 12%. 
• Coal India has reported rise in its production by 7.2% to 58.02 million tonnes in December 2019. 
• NTPC has decided to procure and use 6 million tonnes of agro residue-based pellets to co-fire its power plants along with coal in 2020.  
• Bajaj Auto has registered a fall of 3% in total sales to 336,055 units in December 2019 against 346,199 units in December 2018.