Indian equity benchmarks ended the choppy day of trade in red terrain on Wednesday, mainly on the back of late hour selloff. Markets traded with volatility and altered between green and red throughout the session as traders remained on sidelines ahead of Wholesale Price Index (WPI) data to be released on February 15. Traders took some solace with India's Retail inflation, measured by the consumer price index (CPI), easing to 5.07% in January 2018, after rising to 5.21% in the month of December. Meanwhile, India's index of industrial production (IIP) for the month of December 2017 came at 7.1% as compared to 8.4% in last month. As per the street expectations it was likely to come at 6.4%. The cumulative growth for the period April-December 2017 over the corresponding period of the previous year stood at 3.7%. Traders also took some encouragement with a survey by economic think tank NCAER enlightened that the Business Confidence Index rose 9.1% in December quarter 2017 over the previous three months as overall sentiment remained buoyant. The NCAER Business Confidence Index (N-BCI) had declined 12.9% in the September quarter as the economy was still adjusting to the implementation of goods and services tax (GST), affecting business sentiments. However, it was the last leg of trade which played spoil sports for the domestic markets and key gauges even broke their crucial 10,500 (Nifty) and 34,100 (Sensex) levels, led by selling in banking shares mainly public sector undertaking (PSU) banks after the Reserve Bank of India (RBI) on Monday after market hours came out with a new non-performing assets (NPA) resolution. In the RBI's new rules, banks would have to harmonise the treatment of specific accounts across their books. If one bank has treated a particular account as an NPA, other lenders on the same account will have to treat it as an NPA in their books as well. However, markets got some support near those crucial levels with Sensex ending comfortably above 34,100 mark, while Nifty somehow managed to end tad above its psychological 10,500 bastion. Investors drew some comfort with Union minister Piyush Goyal's statement that the country's economic growth is likely to cross 7.5% in the next fiscal. Finally, the BSE Sensex declined 144.52 points or 0.42% to 34,155.95, while the CNX Nifty was down by 38.85 points or 0.37% to 10,500.90.

The US markets closed higher on Wednesday, booking a fourth consecutive gain after investors shook off initial anxieties prompted by a key consumer-inflation reading that showed the strongest monthly rise in five months. On the economy front, the consumer-price index leaped 0.5% in January to mark the biggest increase in five months, adding to recent worries about rising inflation. The cost of rent, clothes, gasoline, health care and auto insurance all rose. Higher consumer prices in January, however, didn't substantially alter the overall picture on inflation. The increase in the CPI over the past 12 months remained unchanged at 2.1%. After stripping out volatile gas and food, the more closely followed core rate of inflation rose 0.3% last month. The 12-month rate of core inflation was also flat at 1.8%. Inflation-adjusted US wages declined by 0.2% in January. Meanwhile, sales at US retailers fell by 0.3% in January - the biggest drop in almost a year - chiefly due to declines at auto dealers and home centers. And a previously reported increase in sales in December was wiped out. Excluding autos, retail sales were flat last month. And sales slipped 0.2% if autos and gas are stripped out. The Dow Jones Industrial Average added 253.04 points or 1.03 percent to 24,893.49, the Nasdaq gained 130.105 points or 1.86 percent to 7,143.62, the S&P 500 edged higher by 35.69 points or 1.34 percent to 2,698.63.

Crude oil futures edged higher to above $60 a barrel on Wednesday, as the U.S. dollar weakened on downbeat economic data. A relatively small build in U.S. oil stockpiles also helped crude oil rebound from its recent losses. The Energy Information Administration (EIA) reported a third consecutive weekly build in oil inventories. This time, the build was 1.8 million barrels for the week to February 9, roughly in line with estimates. Also supporting crude prices were supportive comments from Saudi oil minister, Khalid al-Falih, who said that OPEC would continue to curb production even if that would result in a supply shortage. Benchmark crude oil futures for March delivery surged 2.4 percent, at $60.60 a barrel on the New York Mercantile Exchange. April Brent crude gained 2.6 percent to $64.36 a barrel on London's Intercontinental Exchange.

Gaining for the second day, Indian rupee ended considerably stronger against the US dollar on Wednesday, on continued selling of the US currency by banks and exporters. Traders took some solace with India's Retail inflation, measured by the consumer price index (CPI), easing to 5.07% in January 2018, after rising to 5.21% in the month of December. Some encouragement also came with a survey by economic think tank NCAER enlightened that the Business Confidence Index rose 9.1% in December quarter 2017 over the previous three months as overall sentiment remained buoyant. Though, selling in last hour of trade in the domestic equity markets limited further appreciation of Indian currency. On the global front, US dollar continued to hover at one-week lows against other major currencies on Wednesday, as sentiment on the greenback remained vulnerable ahead of the release of highly-anticipated US inflation data due later in the day. Finally, the rupee ended at 64.08, 23 paise stronger from its previous close of 64.31 on Monday.

The FIIs as per Wednesday data were net sellers in equity segment, while they were net buyers in debt segment. In equity segment, the gross buying was of Rs 4354.54 crore against gross selling of Rs 5233.87 crore, while in the debt segment, the gross purchase was of Rs 1071.18 crore with gross sales of Rs 875.09 crore. Besides, in the hybrid segment, the gross selling was of Rs 0.14 crore against no buying.

The U.S. markets edged higher on Wednesday, as traders shrugged off bigger than expected increase in consumer prices in the month of January. Traders also ignored report that retail sales fell by 0.3 percent in January compared to economist estimates for a 0.2 percent uptick in sales. Asian markets have made firm start on Thursday, following strong overnight gains in the U.S. and Europe, though trading in much of the region should be slow ahead of the Lunar New Year holiday. Indian stock markets pared initial gains to end lower on Wednesday, with banks coming under heavy selling pressure, after the RBI unveiled new norms for dealing with non-performing assets. Today, the start is likely to be on positive side amid firm global cues. Traders will be eyeing the WPI inflation numbers and Balance of trade figure for the month of January to be released later in the day. Traders will get some support with private report that the RBI's revised framework for quicker and time-bound resolution of stressed assets is a long-term positive for banks. The report stated that the new framework has the potential to bring about a big change in the approach of banks to monitor their exposures and resolution of NPAs. There will be some buzz in steel related stocks on report that India has initiated a review of the anti-dumping duty on flat base steel wheels from China to take a call on the need for continued imposition of the duties in force. Stocks related to mining space too will be in focus on report that with the cancellation of iron ore mining leases in Goa, the Supreme Court has once again stepped into the space vacated by executive failure and legislative lethargy. But the courts cannot compensate for the lack of sound policy and its effective implementation. There will be lots of important earnings announcements too, to keep the markets buzzing.

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

Nifty Top volumes

• Yes Bank has listed its debut $600 million bond issue under its maiden $1 billion MTN programme on Global Securities Market.
• Sun Pharmaceutical has reported 75.17% fall in its net profit at Rs 365.39 crore for Q3FY18 as compared to Rs 1,471.82 crore for Q3FY17.
• NTPC will supply 300 MW to power-starved Bangladesh as part of India's strategy of playing a key role in creating a new energy security architecture for its neighbours.
• Larsen & Toubro's wholly owned subsidiary LTHE has secured an Rs 2200 crore EPC contract from Al Dhafra Petroleum Operations Company for field development in Abu Dhabi, UAE.