After snapping the last quarter of FY17 with over eleven percent gains, Indian equity markets have started the FY18 on an optimistic note thanks to the supportive global as well as local tidings. Sentiments got some support with the report that the health of India's manufacturing sector rose to a five-month in March 2017. The Nikkei India Manufacturing Purchasing Managers' Index (PMI) rose to 52.5 in March from 50.7 in February. The survey said that incoming new orders expanded at a stronger pace, thereby leading to quicker increases in production and input purchasing. Moreover, firms hired additional employees to cope with greater workloads. Investors got some comfort with the report that the India's GDP growth is expected to pick up again to 7.6 per cent next year thanks to improving consumption, timely rains, higher public sector spending and better export growth. According to the report, the ongoing reforms will strengthen the productivity part of growth and the country's GDP will benefit from India's favourable working age population growth.  Some support also came with Union Minister of State for Finance Arjun Ram Meghwal's assurance that the historic tax reform Goods and Services Tax (GST) will see 100 percent implementation from July 1, 2017.  He also said that the Centre is already working on ironing out any road-block and even States are co-operating. However, gains remained capped with the report that Core sector growth slowed to a 15-month low in February, led by a drop in cement output. Growth, as measured by the index of eight core industries, eased to 1 percent in February from 3.4 percent in January and 9.4 per cent a year earlier. Finally, the BSE Sensex surged 289.72 points or 0.98% to 29910.22, while the CNX Nifty was up by 64.10 points or 0.70% to 9,237.85. Indian markets remained closed on Tuesday on account of Ram Navami.

The US markets closed higher on Tuesday, as energy shares rebounded in concert with oil prices. But market sentiment remained cautious ahead of a meeting later this week between President Donald Trump and his Chinese counterpart Xi Jinping. Looking ahead, investors are eagerly awaiting coming quarterly results and a report on employment due Friday for confirmation that the markets months long rally is supported by earnings and economic improvement. According to FedWatch tool, the market is pricing in a more than 60% chance of a rate increase at the Federal Reserve's June meeting, compared with a 6% chance of a rate increase at its policy gathering in May. On the economy front, the US trade deficit sank almost 10% in February, aided by an increase in exports to a 26-month high and a plunge in imports of autos, cell phones and other consumer goods. The deficit fell to $43.6 billion in February, more than canceling out a big increase in January that raised the nation's trade gap to a five-year high of $48.2 billion. The Dow Jones Industrial Average added 39.03 points or 0.19 percent to 20,689.24, the Nasdaq was up 3.93 points or 0.07 percent to 5,898.61, while S&P 500 gained 1.32 points or 0.06 percent to 2,360.16.

Crude oil futures surged on Tuesday supported by signs that U.S. inventories have finally dwindled from record highs. Investors shifted focus to U.S. energy data from the American Petroleum Institute and the U.S. Energy Information Administration. Meanwhile, the Energy Information Administration (EIA) said that gasoline demand is typically about a million barrels per day higher at its summer peak than at its low point for the year. Also, over the weekend, OPEC's Secretary-General Mohammad Barkindo said the cartel's supply quota plan was starting to work. Benchmark crude oil futures for May delivery gained $0.79 or 1.6 percent to $51.03 on the New York Mercantile Exchange. In London, Brent crude for May delivery ended higher by $0.97 at $54.09 on the ICE.

Indian rupee ended considerably weaker against the US dollar on Monday due to dollar demand from banks and importers. Sentiments remained down-beat with the report that Core sector growth slowed to a 15-month low in February, led by a drop in cement output. Growth, as measured by the index of eight core industries, eased to 1 percent in February from 3.4 percent in January and 9.4 per cent a year earlier. Further, traders remained cautious ahead of the Reserve Bank of India's (RBI) bi-monthly two-day policy meeting on April 5-6. The RBI is likely to hold rates and retain its neutral stance in the policy. On the global front, dollar edged up on Monday as investors shrugged off a lack of motives to buy it last week and awaited more clarity on the strength of the US economy and pace of future interest rate hikes. Finally, the rupee ended at 65.02, 17 paise weaker from its previous close of 64.85 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 9068.66 crore against gross selling of Rs 5579.09 crore, while in the debt segment, the gross purchase was of Rs 2109.42 crore with gross sales of Rs 1429.35 crore.

The US markets closed modestly in green in the last session, though the trade remained lackluster and the major averages spent the day bouncing back and forth across the unchanged line, ahead of some key events later this week. The Asian markets have made a mixed start with some indices trading marginally in red; however the Chinese market was trading higher coming after a long weekend. The Japanese market too was in green as the yen weakened against the dollar. The Indian markets before going for a holiday had posted strong gains with benchmarks reaching fresh record highs, on hopes of Goods and Services Tax roll out from July and solid manufacturing data. Today, the start is likely to be in green on mostly positive global cues. Also, markets will be getting some support with the central government exceeding 2016-17 tax target, highest in last 6 years. Government reported a total tax collection of Rs 17.10 lakh crore during 2016-17 -- an increase of 18 per cent over 2015-16. In the revised estimates for FY17 presented in the budget, the government had raised the tax collection target to Rs 17.03 lakh crore against Rs 16.3 lakh crore estimated initially. The IT stocks are likely to react negatively to the report that in the new guidelines issued by the US administration it has been said that companies applying for visas under the H-1B programme must provide "evidence to establish that the particular position is one in a specialty occupation". However, software industry body Nasscom said that the clarification is expected to have "little impact" on Indian technology companies. There will be some buzz in steel stocks too as the WTO has set up a panel to resolve the dispute between Japan and India over imposition of safeguard import duty on iron and steel products.

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

Nifty Top volumes

• M&M has reported its auto sales performance for March 2017 which stood at 56,031 vehicles compared to 52,718 vehicles during March 2016, representing a growth of 6%.
• Maruti Suzuki India has reported a jump of 8.05% in total sales at 1,39,763 units in March 2017.
• Tata Motors' passenger and commercial vehicle total sales in March 2017 were at 57,145 units, higher by 8% over 53,057 units sold in March 2016.
• Tata Steel has reported a 17% increase in Q4FY17 sales to 3.17 million tonne (MT) compared to 2.71 MT in Q4 FY16.