After 2-day euphoric rally, bulls took a breather on Tuesday's trading session, with the Sensex and the Nifty ending on flat note. Key indices made a cautious start of the day and traded sluggish for the most part of the session, as former Union finance minister Yashwant Sinha said that a contraction in demand and reluctance to invest are key reasons for the current slowdown in the Indian economy, which grew at its slowest pace in over six years in the June quarter. Adding more worries, the latest data released by the Agriculture Ministry showed that the country's foodgrains production is estimated slightly lower at 140.57 million tonnes in the kharif season of 2019-20 crop year on likely fall in rice and pulses output. However, markets managed to stage recovery in late afternoon session. Sentiments got comfort, after Reserve Bank Governor Shaktikanta Das said that the government's recent decision to cut corporate tax rates is a bold measure and augurs well for the economy. Adding some relief, Crisil Research also said that the reduction in corporate tax announced by Finance Minister Nirmala Sitharaman could help the top 1,000 listed companies in the country save at least Rs 37,000 crore this fiscal year. Separately, NITI Aayog vice chairman Rajiv Kumar said that India has become a more attractive investment destination following the reduction in corporate tax rates but relocation of units from competitors such as China will depend on other factors as well, such as the ability of states to make their environment more business-friendly. Finally, the BSE Sensex gained 7.11 points or 0.02% to 39,097.14, while the CNX Nifty was down by 12.00 points or 0.10% to 11,588.20.

The US markets ended lower on Tuesday after President Trump criticized China in a United Nations speech, undermining investor sentiment that had been improving on hopes for successful trade talks in October. Stocks were also whipsawed by worries about President Donald Trump's political future. House Speaker Nancy Pelosi will announce a formal impeachment inquiry after she meets with her caucus to discuss the call Trump had earlier this year with Ukraine's leader, Volodymyr Zelensky, where he allegedly pressured him to investigate Democratic presidential hopeful Joe Biden's family. Besides, cautiousness too prevailed in the markets, after a report released by the Conference Board showed US consumer confidence deteriorated by much more than anticipated in the month of September. The Conference Board said its consumer confidence index tumbled to 125.1 in September from a downwardly revised 134.2 in August. Street had expected the consumer confidence index to dip to 133.0 from the 135.1 originally reported for the previous month. Lynn Franco, Senior Director of Economic Indicators at the Conference Board, said an escalation in trade and tariff tensions in late August appears to have rattled consumers. However, Franco said this pattern of uncertainty and volatility has persisted for much of the year and it appears confidence is plateauing. She added, while confidence could continue hovering around current levels for months to come, at some point this continued uncertainty will begin to diminish consumers' confidence in the expansion. Dow Jones Industrial Average dropped 142.22 points or 0.53 percent to 26807.77, Nasdaq declined 118.83 points or 1.46 percent to 7993.63 and S&P 500 was down by 25.18 points or 0.84 percent to 2966.60.

Crude oil futures ended lower with cut of over two percent on Tuesday, pressured by signs that Saudi Arabia is making progress in restoring production following attacks on processing facilities, as well as concerns over the global demand picture. Oil prices also declined on report that President Donald Trump turned up pressure on China as Washington and Beijing continue to seek a trade deal, and said all nations have a duty to act on Iran. Besides, weak economic data from Asia, Europe and the US raised concerns about near term energy demand. Benchmark crude oil futures for October dropped $1.35 or 2.3 percent to settle at $57.29 a barrel on the New York Mercantile Exchange. November Brent fell $1.67 cents or 2.6 percent to settle at $63.10 a barrel on London's Intercontinental Exchange.

Indian rupee pared all of its gains and ended marginally weaker against dollar on Tuesday, due to fresh demand for the American currency from banks and importers. Investors were worried with former Union finance minister Yashwant Sinha's statement that a contraction in demand and reluctance to invest are key reasons for the current slowdown in the Indian economy, which grew at its slowest pace in over six years in the June quarter. Lackluster trade in the equity markets also affected the rupee value. On the global front, euro nursed losses on Tuesday after weak readings on German manufacturing rattled confidence, while the dollar found broad support as investors looked for signs of progress from Sino-US trade negotiations. Finally, the rupee ended at 71.01, 7 paise weaker from its previous close of 70.94 on Monday.

The FIIs as per Tuesday's data were net buyers in equity segment, while they were net sellers in debt segment. In equity segment, the gross buying was of Rs 10932.50 crore against gross selling of Rs 8128.22 crore, while in the debt segment, the gross purchase was of Rs 1304.05 crore with gross sales of Rs 1736.43 crore. Besides, in the hybrid segment, the gross buying was of Rs 3.87 crore against gross selling of Rs 2.35 crore.

The US markets declined on Tuesday after a hawkish statement on trade by President Donald Trump and as congressional Democrats moved towards an impeachment inquiry into Trump.  Asian markets are trading in red on Wednesday following losses on Wall Street. Indian markets ended a volatile session almost flat on Tuesday, as investors scrambled to book profits after a stellar two-day rally. Today, the start of session is likely to be pessimistic mirroring weakness in global markets. There will be some cautiousness with report that India's fiscal deficit gap is set to increase by at least 70 basis points to 4 percent of the gross domestic product (GDP) for 2019-20 after Finance Minister Nirmala Sitharaman announced a cut in corporate tax rates on September 20. However, traders may take some encouragement later in the day as describing the government's move to slash corporate tax rate as a bold measure, RBI Governor Shaktikanta Das said it has made India a very attractive destination for foreign investment. With regard to domestic investors, he said, they now have more cash so they will be able to undertake more capital expenditure. Some support may also come with Union Minister Ravi Shankar Prasad's statement that India must aspire to be the largest FDI recipient globally and has everything going for it, given its vibrant digital profile, huge market and investor-friendly policies to woo foreign companies, including Apple. Besides, US President Donald Trump said his country will soon have a trade deal with India to boost economic ties between the two nations. There will be some reaction in banking stocks with India Rating's report that banks are staring at a spike in their credit cost, which is set to rise in the range of 1.9-4.6 percent for the second half of the current fiscal, with slower pace of resolution of bad loans. Pharma stocks will be in focus with ICRA's report that the pharmaceutical sector which enjoys a host of tax exemptions will not see any tangible benefits from the corporate tax rate cut announced last week by the government. There will be some buzz in the auto stocks with report that bank loans to finance vehicle purchases in India has slipped to 4.9% year-on-year at the end of July, less than half of the growth recorded in the year-ago period, indicating a slump in demand for cars and trucks which is in sync with the overall private consumption slowdown. Meanwhile, as per a report, Indian Railway Catering and Tourism Corporation (IRCTC), a subsidiary of Indian Railways that handles its ticketing and catering operations, is likely to launch its initial public offering (IPO) on September 30. The proposed IPO is expected to see the government sell stake worth Rs 480 crore through an offer for sale.

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

Nifty Top volumes

• Wipro has launched the first phase of noomis, the new online platform of FEBRABAN, an industry association that represents the financial services sector in Brazil. 
• Reliance Industries' subsidiary -- Haptik has acquired Buzzo.ai, a Mumbai-based conversational commerce start-up. 
• M&M has unveiled W6 Diesel Variant of the XUV300 with automated manual transmission at Rs 9.99 lakh. 
• TCS has launched the TCS BaNCS Cloud for Asset Servicing, which automates the servicing of all classes of assets across all markets.