Indian benchmarks started the new month on a disturbing note as the benchmark equity indices failed to extend the four session northbound journey and settled with moderate cuts of over a quarter percent. It largely turned out to be a range bound session marred with high volatility as investors indulged in stock specific activities after country's economy grew lower than expected in the September quarter at 7.3%, as compared to 7.6% registered during the same period last fiscal year.  The data indicate that the economy may witness the heavy impact of demonetisation in the third quarter and even some part of the fourth quarter. Adding anxiety among market percipients, the private report indicated that Indian factory activity decelerated sharply last month after Prime Minister Narendra Modi's currency crackdown led to a rationing of cash and cooled domestic consumption, new orders and production. The Nikkei/Markit Manufacturing Purchasing Managers' Index fell to 52.3 in November from October's 54.4, its biggest month-on-month decline since March 2013. Furthermore, West Bengal Finance Minister Amit Mitra dropped a bombshell, by saying that the Goods and Service Tax (GST) would be difficult to implement from April next year. He claimed that PM Modi's surprise announcement on November 8 has slowed down the economy and states are losing more money sooner than planned. Amendments related to GST are still pending in the Parliament. Proceedings in the House have been stalled with the opposition demanding Prime Minister Narendra Modi's presence during the debate on demonetisation. Investors failed to draw any sense of relief with the report that the combined index of eight core industries surged to its six months high at 6.6 percent compared to October 2015, led by steel, cement and petroleum refinery. Meanwhile, shares of pharmaceutical companies edged higher after the Delhi High Court set aside the Centre's decision to ban 344 fixed dose combination (FDC) medicines, while Indian jewellery stocks gained traction after reports of excise duty getting scrapped on branded gold coins. Finally, the BSE Sensex declined by 92.89 points or 0.35% to 26559.92, while the CNX Nifty dropped 31.60 points or 0.38% to 8,192.90.

The US markets closed mostly lower on Thursday, while the Dow Jones Industrial Average bucked the broader market's weakness to close at a record high. Investors were pocketing short-term profits as the market consolidates following a strong run-up since early November has contributed to the selling pressure. An Italian referendum on proposed constitutional reform on Sunday, widely viewed as a vote of confidence in Prime Minister Matteo Renzi, also prompted jitters. Meanwhile, the Atlanta Federal Reserve's GDP Now forecast model showed that the US economy is on track to grow at a 2.9 percent annualized pace in the fourth quarter following the latest data on manufacturing and construction spending. The latest fourth-quarter GDP estimate was higher than the 2.4 growth rate calculated. Data releases were mixed but pointed to continued growth in the labor market and manufacturing. The number of Americans applying for unemployment benefits jumped in the most recent week, but stayed close to multi-decade lows. Initial jobless claims rose by 17,000 to a seasonally adjusted 268,000 in the November 26 week. The Nasdaq was down 72.57 points or 1.36 percent to 5,251.11, S&P 500 dropped 7.73 points or 0.35 percent to 2,191.08, while the Dow Jones Industrial Average added 68.35 points or 0.36 percent to 19,191.93.

Crude oil futures continued their surge on Thursday, after Russia joined the deal, the first of its kind between the Kremlin and OPEC in fifteen years. Earlier the OPEC surprisingly announced a deal to curb supplies. OPEC produces a third of global oil, or around 33.6 million barrel per day, and the deal aims to reduce output by 1.2 million bpd from January 2017, similar to January 2016 levels. While the Nymex crude crossed the $51/barrel, the brent crude surged to its highest in about 16 months. Benchmark crude oil futures for January delivery surged by $1.62 or 3.3 percent to $51.06 on the New York Mercantile Exchange. In London, Brent crude for January delivery ended higher by $2.10 or 4.1 percent at $54.53 on the ICE.

Indian rupee appreciated against dollar on Thursday, due to selling of greenback by banks and importers. Sentiments got some support with the report that the combined index of eight core industries surged to its six months high at 6.6 percent compared to October 2015, led by steel, cement and petroleum refinery. Meanwhile, Indian economy maintaining its growth momentum remained the world's fastest growing major economy in the July-September quarter. Data released by the Central Statistics Office (CSO) showed the economy grew an annual 7.3 percent in the July-September quarter, marginally faster than previous quarter's expansion of 7.1 percent, while it grew 7.6 percent in the July-September 2015-16. On the global front, dollar touched a 9-1/2-month high against the yen on Thursday, as oil prices surged after OPEC agreed to output cuts - lifting inflation expectations and U.S. bond yields. Finally, the rupee ended at 68.34, 4 paise stronger from its previous close of 68.38 on Wednesday.

The FIIs as per Thursday's data were net sellers in equity segment, while they were net buyers in debt segment. In equity segment, the gross buying was of Rs 14,573.16 crore against gross selling of Rs 14,933.55 crore, while in the debt segment, the gross purchase was of Rs 2719.01 crore with gross sales of Rs 2275.74 crore.

The US markets made a mixed closing in last session, while the Dow reached a new record closing high, the tech-heavy Nasdaq showed a notable decline. Traders reacted to the OPEC's deal of reducing oil production and mixed set of economic data. The Asian markets have made mostly a weak start and some of the indices in the region are down by half to one percent. The Japanese market was down as yen extended its rebound against the greenback amid caution ahead of key American jobs data. The Indian markets snapped their gaining streak in last session after manufacturing showed signs of demonetization impact. Traders were also concerned with rise in inflation due to surge in global oil prices. Today, the start is likely to remain soft-to-cautious. Traders will be eyeing the GST Council meet starting today, which after being called off last time due to differences between states and demonetization, has been rescheduled. The meeting has become significant in the light of the controversial comments made by West Bengal finance minister Amit Mitra that demonetization - making over 85% of old Rs 500 and Rs 1,000 currency notes illegal - will delay implementation of GST. Meanwhile, Finance Minister Arun Jaitley has said that goods and services tax (GST) and demonetisation will be 'game changers' for Indian economy. He added that this is because GST will ensure higher taxation as far as the Centre is concerned and also higher taxation for states. The gold and jewellary stocks will keep buzzing as the Finance Ministry has clarified that the entre has not introduced any specific provision in the recently introduced Taxation Laws Bill to cover "household jewellery". It added that legitimate holding of jewellery up to any extent is fully protected. The telecom stocks will remain under pressure with Mukesh Ambani-owned Reliance Jio Infocomm extending its free voice and data offer for both new and existing subscribers till March 31, 2017, intensifying the brutal price war in telecom sector.

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

Nifty Top volumes

• Wipro has bagged three-year IT infrastructure services and digital transformation contract by Woodside.
• Mahindra & Mahindra has reported its auto sales numbers for November 2016 which stood at 32,499 vehicles compared to 41,590 vehicles during November 2015.
• NTPC has received an investment approval for Rojmal Wind Energy Project in the state of Gujarat at an appraised estimated cost of Rs 323.35 crore.
• Bharat Heavy Electricals has successfully commissioned the first unit of the 4x30 MW Pulichintala Hydroelectric project in the state of Telangana.
• Bajaj Auto has officially named its biggest and most powerful motorcycle as 'Bajaj Dominar 400', and will be launching the model on December 15.