On Thursday, Indian markets concluded a session characterized by range-bound trading, ending with a positive inclination. This came a day after the US Federal Reserve opted to maintain key interest rates steady at 5.5 percent. Today, the domestic indices are poised for an optimistic start, aligning with the upward trends witnessed in global markets.

Boosting market sentiments is the Organisation for Economic Co-operation and Development (OECD), which has revised India's growth forecast upwards by 40 basis points to 6.6 percent for the fiscal year 2024-25. This revision is underpinned by expectations of robust public investment and enhanced business confidence, likely to fuel India’s gross domestic product (GDP) growth.

Further reinforcing this optimism is a private report highlighting India's emergence as an economic powerhouse with premium valuations in the stock market. However, challenges persist for achieving inclusive growth, despite India's climb from the tenth to the fifth largest economy globally over the past decade. Additionally, concerns arise from India's substantial imports in electronics, telecom, and electrical products, with over half originating from China and Hong Kong.

Despite these positive indicators, apprehensions linger due to foreign fund outflows. According to provisional data from the NSE, foreign institutional investors (FIIs) net sold Rs 964.47 crore shares on May 2. Moreover, Reserve Bank data indicates a decline in India's services exports by 1.3 percent in March to $30 billion, coupled with a 2.1 percent fall in imports to $16.61 billion, while maintaining a trade surplus of $13.4 billion in March 2024.

The coal industry, however, shows promise with a notable 7.41 percent increase in domestic coal production to 78.69 million tonnes (MT) in April. Earnings reports from key companies such as Titan, Britannia Industries, Adani Green Energy, and others, set to be announced later today, are anticipated with interest.

In the US, markets closed higher on Thursday, with investors eyeing upcoming earnings reports and the release of the nonfarm payrolls data on Friday. Asian markets largely mirrored this positive sentiment, with Wall Street gains influencing trading ahead of key U.S. employment data, while markets in Japan and mainland China remained closed for public holidays.

Back home, Indian equity benchmarks closed higher on Thursday amidst volatility, driven by gains in Utilities, PSU, and Power stocks. Additionally, a decline in oil prices and robust domestic auto sales figures buoyed market sentiments. Despite an initial dip, frontline indices reversed losses during the day. Positive indicators such as India's Goods and Services Tax (GST) collections hitting a record high in April 2024 at Rs 2.1 lakh crore and a marginal slowdown in growth in India's manufacturing sector in April were noted.

However, market gains were tempered towards the end of the trading session as foreign portfolio investors (FPIs) turned net sellers in Indian stocks for April, amidst geopolitical tensions in the Middle East and a robust US bond yield. Concerns also arose regarding a potential delay in interest rate cuts by the Reserve Bank of India, amidst rising inflation risks and the US Federal Reserve's decision to hold rates for a longer period.

Ultimately, the BSE Sensex closed up by 128.33 points or 0.17% at 74,611.11, while the CNX Nifty gained 43.35 points or 0.19% to reach 22,648.20 by the end of the trading session.