Indian equity benchmarks faced rough ride on Thursday's trading session, with Sensex and Nifty ending lower by around 0.25% each. After a cautious opening, key indices remained lackluster throughout the day, as India's factory output growth, measured in terms of Index of Industrial Production (IIP), contracted by 0.3% in December 2019 as compared to expansion of 2.5% in December 2018, mainly on account of a decline in manufacturing sector output. Adding more worries among traders, India's retail inflation based on Consumer Price Index (CPI) jumped to 7.59% in January 2020. The CPI was 1.97% in January 2019 and 7.35% in December 2019. Weak trade continued over the Dalal Street in the second half of the trading session, on the back of Finance Minister Nirmala Sitharaman's statement that Goods and Services Tax (GST) compensation to states is delayed due to inadequate realisation of cess and that the Centre was not according any differential treatment to states. Market participants paid no heed towards Chief Economic Advisor Krishnamurthy Subramanian's statement that the coronavirus outbreak in China provides an opportunity for India to expand exports. India is one of China's leading trade partners in Asia and has a huge trade deficit with that country. Finally, the BSE Sensex lost 106.11 points or 0.26% to 41459.79, while the CNX Nifty was down by 26.55 points or 0.22% to 12174.65.

The US markets ended lower on Thursday amid reports of a jump in new coronavirus cases. Officials revealed an additional 242 deaths from the coronavirus in the Chinese province of Hubei as well as 14,840 new confirmed cases. While the jump in confirmed cases was partly due to the adoption of new methodology for counting infections, the spike still led to renewed fears about the outbreak. On the economic data front, with higher prices for food and shelter offsetting a steep drop in gasoline prices, the Labor Department released a report showing a modest increase in US consumer prices in the month of January. The Labor Department said its consumer price index inched up by 0.1 percent in January after rising by 0.2 percent in December. Street had expected prices to increase by 0.2 percent. The uptick in consumer prices was primarily due to an increase in shelter costs, which climbed by 0.4 percent in January. Besides, first-time claims for US unemployment benefits inched up by less than expected in the week ended February 8, according to a report released by the Labor Department. The report said initial jobless claims crept up to 205,000, an increase of 2,000 from the previous week's revised level of 203,000. Street had expected jobless claims to rise to 210,000 from the 202,000 originally reported for the previous week. The Labor Department said the less volatile four-week moving average was unchanged from the previous week's revised average at 212,000. Meanwhile, the report said continuing claims, a reading on the number of people receiving ongoing unemployment assistance fell by 61,000 to 1.698 million in the week ended February 1.

Crude oil futures ended higher for third straight session on Thursday as the potential for OPEC+ output cuts fueled some optimism, despite a rise in the number of COVID-19 cases in China and lower forecasts for oil demand growth. China reported 254 new deaths from the virus, while the number of new cases jumped 15,152, after the government applied a new methodology in hard-hit Hubei province of diagnosing infections of the novel strain of coronavirus that reportedly originated in Wuhan, China, last year and was recently classified by the World Health Organization as coronavirus disease. The new figures brought total deaths from the outbreak at 1,362, while the total number of confirmed cases rose to 59,804. Meanwhile, The International Energy Agency (IEA) lowered its forecast for oil-demand growth to its slowest pace since 2011, blaming the viral outbreak. It now expects global demand for crude to grow by 825,000 barrels a day in 2020, down 365,000 barrels a day from its previous forecast. Crude oil futures for March gained 25 cents or 0.5 percent to settle at $51.42 a barrel on the New York Mercantile Exchange. April Brent rose 55 cents or 1 percent to settle at $56.34 a barrel on London's Intercontinental Exchange.

Indian rupee remained unchanged as compared to its previous close, as weak macro-economic data disappointed market participants. India's retail inflation based on Consumer Price Index (CPI) spiked to 7.59 per cent for the month of January 2020 from 7.35 per cent in December 2019, due to costlier food products like vegetables, pulses and protein-rich items. Industrial production contracted by 0.3 per cent in December 2019 as against 2.5 per cent growth in same month a year ago, weighed by a decline in the manufacturing sector. A weak trend at Dalal Street and rising crude oil prices weighed on the local unit, while weakening of the American currency supported the local unit to some extent. On the global front, yen rose from a three-week low against the dollar on Thursday after China's Hubei province, the epicenter of a coronavirus outbreak, reported a sharp jump in the number of new cases in a jolt to markets and sparking a flight for safe-haven assets. The last traded price of rupee was 71.33, unchanged from its previous close on Wednesday.

The FIIs as per Thursday's data were net sellers in equity and debt segments, In equity segment, the gross buying was of Rs 4949.58 crore against gross selling of Rs 5612.59 crore, while in the debt segment, the gross purchase was of Rs 963.32 crore with gross sales of Rs 1706.64 crore. Besides, in the hybrid segment, the gross buying was of Rs 6.38 crore against gross selling of Rs 9.34 crore.

The US markets ended in red on Thursday as investors grappled with a jump in reported coronavirus cases and the virus' possible economic impact. Asian markets are trading mostly higher on Friday as China is set to halve tariff rates on certain US products with effect later during the day. Indian markets ended lower on Thursday after government data showed a surprise drop in December industrial output and a rise in January inflation to a six-year high. Today, the start of session is likely to be in green following Asian peers and ahead to the wholesale inflation numbers to be out later in the day. Traders will be getting encouragement with report that foreign investors turned net buyers in the Indian markets in the December quarter, pumping in a staggering $6.3 billion on the back of the government's intent to bring reforms for supporting the economic growth. Some support will also come as global ratings agency Standard and Poor's affirmed India's sovereign rating at BBB- with stable outlook, saying the country's GDP growth is likely to gradually recover towards longer-term trend rates over the next two to three years. Besides, the Reserve Bank of India's (RBI) data showed that banks credit and deposits grew at 7.13 percent and 9.91 percent to Rs 101.02 lakh crore and Rs 133.24 lakh crore, respectively, in the fortnight ended January 31. Traders may take note of report that the Office of the US Trade Representative (USTR) said India has been removed from the list of developing countries and instead will now be considered a developed nation. However, there may be some cautiousness with the International Monetary Fund's (IMF) communications director Gerry Rice's statement that India's economy looks weaker than the IMF projected earlier in January and the government needs to focus on more ambitious structural and financial sector reform measures. Meanwhile, markets watchdog Securities and Exchange Board of India (SEBI) has issued guidelines for portfolio managers and said they cannot charge upfront fee from clients. There will be some buzz in the banking stocks with Moody's report that the RBI's recent asset recognition norms that allows banks not to treat real estate loans as restructured for one year is credit negative for Indian banks. Construction industry stocks will be in focus as India Ratings revised its outlook for the construction industry to negative for FY21 on the back of muted order inflows and subdued bank credit flow. There will be some reaction in textile stocks with Union Textile Secretary Ravi Capoor's statement that the Central government would address all issues in its new National Textile Policy which is likely to be announced in a couple of months. 

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

Nifty Top volumes

• HDFC Bank has signed MoU with the Odisha government, in a bid to strengthen the startup ecosystem in the state. 
• Bajaj Auto has launched BS-VI compliant version of its popular motorcycle Pulsar 150 at a starting price of Rs 94,956. 
• Tata Motors' wholly owned subsidiary -- JLR has launched the BS-VI version of its SUV Discovery Sport in both petrol and diesel engines. 
• Bajaj Finance has raised funds worth Rs 3000 crore through allotment of 30000 Secured Redeemable NCDs of face value of Rs 10 lakh each on Private Placement basis.