Indian equity benchmarks extended their decline for fifth straight day on Wednesday, with Sensex and Nifty closing below their crucial psychological levels of 37,900 and 11,300, respectively. Key indices made a cautious start of the day, after the International Monetary Fund (IMF) in its World Economic Update revised downward India's Gross Domestic Product (GDP) growth forecast by 0.3% for 2019 and 2020 to 7.0% and 7.2%, respectively, over its previous projections early this year. Weakness continued on the street amid a private report stating that the economy will not be able to achieve the official forecast of 7 percent growth in FY20, making it a second consecutive year of sub-7 percent expansion. However, markets managed to pare some of their losses in the late leg of the trade to come off from intraday low points, after Finance minister Nirmala Sitharaman signaled that the government may extend the lower corporate tax rate of 25% to all companies, giving India Inc something to cheer about. Her July 5 budget had lowered the rate for most companies but excluded the biggest. Meanwhile, the Minister of State for Finance Anurag Singh Thakur said there is no official estimation of black money in the country, however, it has taken several concrete steps to crack down on illicit funds. Finally, the BSE Sensex lost 135.09 points or 0.36% to 37,847.65, while the CNX Nifty was down by 59.75 points or 0.53% to 11,271.30.

The US markets ended mostly higher on Wednesday despite mixed earnings and economic data and antitrust probes into leading US technology stocks. Investors were encouraged by reports that a US delegation headed by US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin is set to travel to China to revive trade talks next week. However, Dow Jones Industrial Average ended lower after disappointing earnings from Boeing and Caterpillar. Boeing Company lost 3%, after the aerospace giant swung to a loss in the second quarter. Caterpillar fell 4.5%, after the manufacturer of construction and mining equipment reported quarterly profit that fell below Street expectations, continuing a trend of subdued performance in industrial stocks during the second-quarter earnings season. On the economic front, new home sales in the US showed a substantial rebound in the month of June, according to a report released by the Commerce Department. The Commerce Department said new home sales spiked by 7.0% to an annual rate of 646,000 in June after plunging by 8.2% to a revised rate of 604,000 in May. Street had expected new home sales to jump by 5.4% to a rate of 660,000 from the 626,000 originally reported for the previous month. The bigger than expected rebound was largely due to a significant turnaround in new home sales in the West, which surged up by 50.4% to a rate of 185,000 in June after plummeting by 38.5% to a rate of 123,000 in May. The report also said new home sales in the South edged up by 0.3% to a rate of 382,000, while new home sales in the Midwest tumbled by 26.3% to a rate of 56,000 and new home sales in the Northeast fell by 4.2% to a rate of 23,000. Nasdaq gained 70.10 points or 0.85 percent to 8321.50 and S&P 500 was up by 14.09 points or 0.47 percent to 3019.56, while Dow Jones Industrial Average dropped 79.22 points or 0.29 percent to 27269.97.

Crude oil futures ended lower on Wednesday, as support from a storm-fueled, 11 million-barrel drop in US crude supplies wore off and traders turned their attention back to concerns about weaker energy demand. Energy Information Administration (EIA) has reported that US crude inventories dropped by 10.8 million barrels for the week ended July 19. The inventory decline was in line with the 11 million-barrel drop reported by the American Petroleum Institute on July 23. Meanwhile, the EIA estimated that domestic oil production fell by 700,000 barrels to 11.3 million barrels for the week ended July 19 following Hurricane Barry. Output still stands above the year-ago level of 11 million barrels a day. Benchmark crude oil futures for September dropped 89 cents or 1.6 percent to settle at $55.88 a barrel on the New York Mercantile Exchange. September Brent fell 65 cents or 1 percent to settle at $63.18 a barrel on London's Intercontinental Exchange.

Indian rupee ended marginally lower against dollar on Wednesday, due to fresh demand for the American currency from banks and importers and rising crude oil prices. Trading sentiments remained subdued with report that the International Monetary Fund (IMF) projected a slower growth rate for India in 2019 and 2020, a downward revision of 0.3 per cent for both the years, saying its GDP will now grow respectively at the rate of 7 and 7.2 per cent reflecting a weaker-than expected outlook for domestic demand. Though, it also said India will still be the fastest growing major economy of the world and much ahead of China. Besides, poor performance of the domestic equity market affected the rupee. On the global front, euro fell to a two-month low against the dollar on Wednesday, hit by weak economic data and speculation that the European Central Bank may open the door to aggressive monetary policy easing as soon as this week. Finally, the rupee ended at 68.98, 4 paise weaker from its previous close of 68.94 on Tuesday.

The FIIs as per Wednesday'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 4264.58 crore against gross selling of Rs 7010.30 crore, while in the debt segment, the gross purchase was of Rs 1510.14 crore with gross sales of Rs 1447.58 crore Besides, in the hybrid segment, the gross buying was of Rs 11.88 crore against gross selling of Rs 17.38 crore.

The US markets ended mostly higher on Wednesday as investors cheered solid earnings results from several large companies. Asian markets are trading mixed on Thursday amid a mixed picture for corporate earnings. Indian markets extended their losses for fifth straight session and ended lower with cut of over one third of a percent each on Wednesday as selloff across sectors intensified amid IMF revising India's GDP growth forecast downward to 7.0% in 2019. Today, the start of the F&O series expiry session is likely to be marginally in green amid mixed cues from global markets. Traders will be getting some encouragement with report that India improved its ranking in the global innovation index by five places to 52nd in 2019 from 57th position in the last year. Commerce and Industry Minister Piyush Goyal released the Global Innovation Index (GII) rankings. Some support will also come with a private report indicating that the Centre is considering an option to raise $10 billion in one go from its first overseas bond sale as early as October. The government would prefer to sell yen or euro-denominated debt so as to offer lower yields. Traders may take note of Revenue Secretary Ajay Bhushan Pandey's statement that the revised direct tax target of Rs 13.35 lakh crore is realistic and achievable with the help of economic growth and exchange of data amongst various agencies and wings of the government. However, there may be some cautiousness as the India Meteorological Department (IMD), raising concerns over the output of summer-sown crops, said that monsoon rains were 35% below average in the week ending on July 24, with little rainfall over the central, western and northern parts of the country. Meanwhile, a committee has been constituted under the Department for Promotion of Industry and Internal Trade to examine issues related to FDI in the e-commerce sector. There will be some buzz in the telecom stocks with report that the Digital Communications Commission (DCC) has approved the recommendation of the Telecom Regulatory Authority of India (Trai) to levy a total penalty of Rs 3,050 crore on Bharti Airtel and Vodafone Idea for refusing to provide points of interconnection to Reliance Jio. There will be some reaction in power stocks with report that in a bid to fast-track wind energy projects, the Centre has made certain amendments to the bidding guidelines for such projects. The development assumes significance as the government has set an ambitious target of having 175 GW of clean energy capacity by 2022, including 100 GW solar and 60 GW of wind energy. There will be lots of earnings reaction based on the performance of the companies.

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

Nifty Top volumes

• NTPC has inked a MoU with Indian Oil Corporation to explore possible business opportunities in the areas of mutual interest. 
• Wipro has launched a global Digital Product Compliance lab in Hyderabad. 
• M&M's subsidiary -- Mahindra Agri Solutions has joined hand with Netherland-based KeyGene to undertake research in key field crops. 
• GAIL India has hired a newly-built LNG ship from Japan's Mitsui OSK Lines for ferrying gas from nations such as the US for three years beginning 2021.