Wednesday's session saw Indian benchmark indices complete a hat-trick of disappointing performances, reaching the finishing with cut of over half a percent.  Disappointing manufacturing surveys from China and the UK, combined with downgrades to growth and inflation forecasts from the European Commission soured investors' mood.  On the domestic front, sentiments were undermined after private sector activity in the country eased in April amid slower expansion in new business inflows in services sector, while order books at manufacturers also broadly stagnated. The Nikkei India Composite PMI Output Index, which maps both manufacturing and services sectors, dropped from 54.3 in March (37-month high) to 52.8 in April, pointing to a softer expansion in private sector activity across the country. Further, a softer expansion in activity suggests that companies are not fully convinced about the recovery. Besides, persistent selling by foreign funds, depreciation of rupee value against the dollar and extended losses in crude oil prices further dented sentiments. Indian rupee weakened 22 paise to 66.64 against the US dollar at the time of equity markets closing on increased demand for the American currency from importers and banks. Some losses were restricted with the Science and Technology Minister Harsh Vardhan's statement that the Monsoon is expected to hit Kerala by May-end or early June, with various forecasting agencies predicting normal or above normal rainfall this year. Furthermore, the International Monetary Fund retained its growth forecast for India this year at 7.5 per cent, largely driven by private consumption even as weak exports and sluggish credit growth weigh on the economy. Meanwhile, sharp selling was witnessed in metal and mining stocks, as copper prices declined in global commodities markets. Telecom stocks declined after the telecom companies told the Supreme Court that the entire sector is under huge debt and they have to pay a big price for spectrum. Finally, the BSE Sensex declined by 127.97 points or 0.51% to 25101.73, while the CNX Nifty dropped 46.15 points or 0.60% to 7,700.85.

The US market closed lower on Wednesday, as weaker-than-expected private-sector jobs data and a slide in worker productivity eclipsed reports of strength in the services industry. On the economy front, private-sector employment gains slowed markedly in April. According to Automatic Data Processing Inc (ADP), Employers added 156,000 jobs in April. This is the weakest estimate since February 2014. ADP lowered March's gains to 194,000 from the prior estimate of 200,000. The small private-sector businesses added 93,000 jobs in April, medium-size businesses added 39,000 and large businesses added 24,000. All of the gains were in the service sector - 166,000 jobs were added there, down from 189,000 in March. The productivity of US businesses and workers fell by a 1% annual rate in the first quarter, marking the fourth decline in the past six quarters. On the other hand, the US trade deficit shrank in March by almost 14% to $40.4 billion - the lowest level in more than a year - but the plunge reflected a tough climate for American exporters and more caution on the part of consumers. US exports fell 0.9% to $176.6 billion in March and remained near the lowest level in several years. The Dow Jones Industrial Average lost 99.65 points or 0.56 percent to 17,651.26, Nasdaq was down by 37.58 points or 0.79 percent to 4,725.64 while, S&P 500 dropped 12.25 points or 0.59 percent to 2,051.12.

Crude oil futures on Nymex made a modestly higher closing on Wednesday, despite paring most of their early gains on the back of output fall and as wildfires disrupted production in Canada. Investors digested the sharpest one-week production decline in US production in nearly a year and a stronger than expected build in domestic crude stockpiles last week. Benchmark crude oil futures for June delivery ended up by $0.19 or 0.44 percent to $43.84 a barrel after trading in a range of $43.23 and $44.87 a barrel on the New York Mercantile Exchange. In London, Brent crude for June delivery closed at $44.70, down $0.27 or 0.60 percent on the ICE.

Indian rupee once again moved lower and ended weaker on Wednesday against the US currency, on fresh dollar demand from banks and importers. Reports of fresh foreign outflows kept impacting the rupee, while the weak reading of India's Services PMI impacted the momentum of the domestic currency. The rupee finally ended at 66.55, lower by 13 paise from its previous closing.

The FIIs as per Wednesday's data were net sellers in equity segment, while they were net buyers in debt segment. In equity segments, the gross buying was of Rs 3577.15 crore against gross selling of Rs 4324.83 crore, while in the debt segment, the gross purchase was of Rs 1147.77 crore with gross sales of Rs 851.99 crore.           

The US markets ended lower for the second day in a row in last session, with the tech-heavy Nasdaq ending the session at its lowest closing level in almost two months. There were some disappointing economic data, with a report from payroll processor ADP showing weaker than expected private sector job growth that weighed on the sentiments. The Asian markets have made mostly a weaker start with some indices witnessing cut of about half a percent after the report that growth in China's services output moderated in April. The Indian markets after a volatile trade extended their losing streak in last session on sluggish global cues, traders remained concerned with the weak Services PMI data. Today, the start is likely to remain in red with major averages extending their losing streak. Traders will also be concerned with a private report stating that government must focus on structural reforms to put the country on the path of faster economic growth, as the 'several reforms' implemented so far may not be enough in a fast-changing world. Meanwhile, President Pranab Mukherjee has said that falling exports is an area of concern despite a healthy current account situation, as it impacts economic performance, industrial growth and employment opportunities. There will be some buzz in the aviation sector stocks, on some reports that the civil aviation policy is likely to come before the Cabinet next week and it may retain the proposal of auctioning unused bilateral rights. There will be some action in telecom stocks too, as the Telecom Minister Ravi Shankar Prasad has said that the number of Internet users in the country is likely to reach 500 million this year from around 400 million Internet users. There will be some important result announcements too, to keep the markets in action.

Support and Resistance: NSE Nifty and BSE Sensex

Nifty Top volumes

• Bharti Airtel's subsidiary Airtel M commerce service is set to start payments bank operations in Q2FY17.
• Kotak Mahindra Bank has launched its International Banking Unit in Gujarat International Finance Tec-City, District Gandhinagar.
• NTPC has synchronized 200 MW out of 250 MW of Stage-I Ananthapuramu Ultra Mega Solar Power Project on April 30, 2016.
• Axis Bank, India's third largest private sector bank has unveiled its RuPay Platinum debit card, in partnership with National Payments Corporation of India.
• Adani Ports has posted a rise of 38.34% on consolidated basis in its net profit at Rs 914.06 crore for the quarter ended March 31, 2016 as compared to Rs 660.73 crore for the corresponding quarter in the FY15.