Indian equity indices completed the week on a sluggish note as the benchmarks showcased an unenthusiastic performance on Friday and settled with moderate cuts of around a quarter percent. Marketmen looked to consolidate their position in the session after rocketing around a percent in the last session and they largely indulged in stock specific activities ahead of next week's F&O expiry. Sentiments remained down-beat in local market as European stock markets got off to a gap down beginning and were trading with cuts of around half percent, while the Asian counterparts too settled on a vigilant note. Adding anxiety among market participants was a private report indicating that some of investment banks have started to cut exposure to Indian equities citing expensive valuations. The global investment banks acknowledged India to be a bright spot among emerging market peers, but the valuation looks expensive. If earnings fail to bounce back, chances of a steep correction will increase. The domestic brokerage houses are also maintaining cautious approach as there is no evidence of any economic recovery out there at the moment, especially on the capex side, while private investment is also not picking up. There is nothing to suggest that capex will return in next six months or in the next financial year. However, investors got some comfort with Minister of State for Finance Arjun Ram Meghwal's statement that the new indirect tax regime is a major tool for improving ease of doing business and has also said that the government will be able to implement Goods and Services Tax (GST) from April 1, next year. On the agricultural front, India's kharif harvest is poised to jump 9% to 135 million tonnes, beating a six-year-old record. Finally, the BSE Sensex declined by 104.91 points or 0.36% to 28668.22, while the CNX Nifty dropped 35.90 points or 0.40% to 8,831.55. 

Snapping their two days gaining streak, US equity markets ended lower on Friday, as traders opted to offload risky assets after recent move to the upside. Sentiments remained dampened after Markit released a report showing that its index of manufacturing activity edged down to 51.4 in September from 52.1 in August, although the data did not attract much attention. A sharp pullback by the price of crude oil also weighed on the markets, with crude for November delivery plunging $1.84 to $44.48 a barrel. The price of crude oil came under pressure after Bloomberg reported Saudi Arabia does not expect an output agreement to stabilize the market in talks in Algiers next week. On the sectoral front, significant weakness was visible among energy stocks, which came under pressure amid the steep drop by the price of crude oil. Semiconductor stocks also saw notable weakness on the day, while most of the other major sectors showed more modest moves. The Dow Jones Industrial Average declined 131.01 points or 0.71 percent to 18,261.45, Nasdaq lost 33.78 points or 0.63 percent to 5,305.75, while S&P 500 was down by 12.49 points or 0.57 percent to 2,164.69. 

Crude oil futures suffered sharp sell-off on Friday, posting their worst daily loss in two months, on report that Saudi Arabia did not expect a decision at Algiers, the capital of Algeria where the biggest oil producers are expected to convene next week for talks. The disappointing news was quickly followed by news on a slight increase in Baker Hughes active rotary rig count. US oil and gas rigs climbed by 5 from last week to 511. Oil rigs were up by 2 to 418, versus last week's count of 416. Benchmark crude oil futures for October delivery was down $1.84 or 3.97 percent to $44.48 on the New York Mercantile Exchange. In London, Brent crude for November delivery ended at $45.98, lower by $1.67 or 3.5 percent on the ICE.

Indian rupee ended marginally higher on Friday due to selling of American currency by banks and exporters. Increased foreign fund inflows in the domestic market and dollar weakness against some other currencies overseas, supported the local currency. Some support also came with Minister of State for Finance Arjun Ram Meghwal stated that the new indirect tax regime is a major tool for improving ease of doing business and that the government will be able to implement GST from April 1, next year. On the global front, dollar gained against yen after the Federal Reserve trimmed its long-term interest rate expectations and the Bank of Japan rebooted its monetary policy framework. Finally, the rupee ended at 66.66, 1 paise stronger from its previous close of 66.67on Thursday.

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 4812.32 crore against gross selling of Rs 4410.33 crore, while in the debt segment, the gross purchase was of Rs 1535.20 crore with gross sales of Rs 1618.19 crore.

The US markets snapped the jubilant trend in last session with investor sentiment getting hit by a renewed slide in crude-oil prices. The Asian markets have made a weak start tailing last session decline in US markets and some of the indices are down by over half a percent, though oil rebounded following its steepest fall in two months, on hopes of prospects of major oil producers agreeing output curbs at talks this week. The Indian markets lost their way and ended lower by over a quarter percent in last session. Today, the start of the F&O expiry week is likely to be soft-to-cautious on weak global cues. Traders may get some support with Reserve Bank of India Governor, Urjit Patel downplaying the risk of inflation and harping on the focus on growth. Patel reportedly said that the GST regime would not harden inflation and the growth objective will remain part of the newly constituted MPC's mandate. Traders will also be getting some support with Niti Aayog Vice-Chairman Arvind Panagariya's statement that a good monsoon, reforms and timely decision making at the Centre will definitely push India's growth beyond the 8 per cent mark in subsequent quarters of this fiscal. Also, the Goods and Services Tax (GST) Council on Friday reached a consensus on three crucial issues - the threshold for exemption, the draft compensation formula and the issue of dual control. Meanwhile, Commerce Minister Nirmala Sitharaman has announced a raft of measures, including setting up of agencies for aquaculture and fisheries in all coastal states and export incentives for marine products, under the Merchandise Exports from India Scheme (MEIS). The PSU oil marketing companies will be in action after the crude oil plunged in last session on reports that Saudi Arabia did not expect a decision in Algeria on production cut.

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

Nifty Top volumes

• Bharti Airtel will invest around Rs 14,667 crore in the Indian and south Asian markets in the current financial year in order to strengthen its network capabilities.
• Idea Cellular has added 4.10 lakh new mobile subscribers in August, 2016.
• BHEL has commissioned a record 15,059 mw of power generating capacity in 2015-16.
• Maruti Suzuki India has attained cumulative exports of 15 lakh vehicles.
• Tata Steel is set for talks with trade union representatives of its UK steelworks to settle the deadlock over a 15-billion-pound pension scheme for its workers.