Indian equity benchmarks ended Wednesday's highly volatile session in the negative territory following a mixed trend in Asian peers as investors await the US Federal Reserve's interest rate decision. Markets made a cautious start and traded on gloomy note throughout the session, as fast-rising Covid-19 cases kept sentiments subdued. Sentiments remained down-beat as global forecasting firm Oxford Economics expects India's GDP growth to lose momentum from late third quarter (October-December) of the current fiscal as the push from the initial reopening fades. It further said India fares the worst in its Asia recovery scorecard, implying that the country will likely take the longest among major economies to converge to its pre-coronavirus growth level. Key gauges witnessed selling pressure at higher zones in late afternoon session, as private report stated that the outlook for India's reeling economy has worsened again as business activity slows and COVID-19 infections soar. Traders shrugged off industry body CII's statement that high frequency indicators are showing a material improvement as compared to multi-year low seen in April, and pointing towards a V-shaped recovery after the economy suffered on account of lockdown amid the coronavirus pandemic. Investors also overlooked Union Minister Nitin Gadkari's statement that the government is making efforts to attract FDI in infrastructure sector to address liquidity crunch faced by the COVID-19-hit economy. Finally, the BSE Sensex lost 421.82 points or 1.10% to 38,071.13, while the CNX Nifty was down by 97.70 points or 0.86% to 11,202.85.

The US markets ended higher on Wednesday after the Federal Reserve left benchmark interest rates unchanged near zero and Fed Chair Powell reiterated his promise to provide support until the threat of the coronavirus to the US economy has passed. The Fed said it decided to maintain the target range for the federal funds rate at 0 to 0.25 percent, where it has remained since an emergency rate cut on March 15. Powell noted that households and the jobs market have slightly improved since May as the nation made headway against the biggest shock to the US economy in living memory, but also warned that rising coronavirus cases in many states now threaten the pace of the recovery. Further, buying interest was generated in reaction to the latest batch of earnings news, with a number of big-name companies reporting better than expected quarterly results. Chipmaker Advanced Micro Devices moved sharply higher after reporting second quarter results that exceeded street estimates and raising its full-year guidance. Shares of C.H. Robinson also spiked after the transportation services provider reported second quarter results that beat street estimates on both the top and bottom lines. The strength on markets also came following the release of a report from the National Association of Realtors (NAR) showing another significant increase in pending home sales in the month of June. NAR said its pending home sales index surged up by 16.6 percent to 116.1 in June after skyrocketing by 44.3 percent to 99.6 in May. Street had expected pending home sales to jump by 15.0 percent. A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

Crude oil futures ended higher on Wednesday after US government data showed a more-than-10-million-barrel weekly decline in US crude - the largest so far this year. The Energy Information Administration (EIA) reported that US crude inventories fell by 10.6 million barrels for the week ended July 24, the largest weekly decline since the 11.5 million-barrel fall reported for the week ended December 27. The American Petroleum Institute on Tuesday reported a decrease of 6.8 million barrels. However, an unexpected weekly rise in gasoline supplies tempered the rise for oil as worries about slow demand growth prevailed. Crude oil futures for September gained 23 cents or 0.6 percent to settle at $41.27 a barrel on the New York Mercantile Exchange. September Brent crude surged 53 cents or 1.2 percent to settle at $43.75 a barrel on London's Intercontinental Exchange.

Indian rupee ended stronger against dollar on Wednesday due to fresh selling of the American currency by banks and exporters. Market participants took support with Road Transport, Highways and MSME minister Nitin Gadkari's statement that the government is making efforts to attract foreign direct investment (FDI) in infrastructure sector. Some comfort also came with Industry body CII's statement that high frequency indicators are showing a material improvement as compared to multi-year low seen in April, and pointing towards a V-shaped recovery after the economy suffered on account of lockdown amid the coronavirus pandemic. However, fast-rising covid cases and weakness in equity markets kept gains capped. On the global front, dollar nursed losses on Wednesday as growing worries about the U.S. economy and investors also looking to Congress and the Federal Reserve for a renewed commitment to endless stimulus. Finally, the rupee ended at 74.80, 4 paise stronger from its previous close of 74.84 on Tuesday.

The FIIs as per Wednesday's data were net buyers in equity, while they were net sellers in debt segment. In equity segment, the gross buying was of Rs 5811.02 crore against gross selling of Rs 5627.74 crore, while in the debt segment, the gross purchase was of Rs 478.12 crore with gross sales of Rs 724.87 crore. Besides, in the hybrid segment, the gross buying was of Rs 12.31 crore against gross selling of Rs 3.89 crore.

The US markets settled higher on Wednesday after the Federal Reserve kept interest rates at ultra-low levels and repeated a pledge to use its full range of tools to support the economy. Asian markets are trading mixed on Thursday amid reports that the US Federal Reserve left interest rates unchanged. Indian markets ended lower with around a percent cut on Wednesday, with heavyweight Reliance Industries, financials and IT stocks pacing the decliners amid mixed global cues. Today, the markets are likely to get a cautious start ahead of Futures and Options (F&O) contracts' expiry amid mixed cues from Asian peers. Rising coronavirus cases may dampen sentiments. India has recorded over 52,000 cases in the past 24 hours, taking its total number of Covid-19-positive cases to 1,584,384. The country's death toll has crossed the 35,000 mark. There will be some cautiousness with Former RBI deputy governor Viral Acharya's statement the suspension of the bankruptcy code for a whole year could be a potential problem for the country. Traders may react to report that the Ministry of Home Affairs (MHA) issued new guidelines for opening up of more activities in areas outside containment zones, as a part of Unlock 3.0, which will come into effect from August 1. The process of phased re-opening of activities has been extended further. Though, some support may come later in the day with the International Monetary Fund's (IMF) statement that the stimulus measures taken by India are substantial, but there is more scope for such measures even after considering the limited fiscal space. There will be some buzz in the banking stocks with report that Prime Minister Narendra Modi held a meeting with top bankers and said his government is firmly behind the banking system and is ready to take any steps necessary to support and promote its growth. Aviation stocks will be in focus as aviation consultancy firm CAPA India warned that Indian aviation industry is at its breaking point due to massive losses on account of COVID-19. There will be some reaction in telecom stocks with Ind-Ra's report that telecom industry has lost 8.2 million subscribers during the complete lockdown in April, and Covid-19 pandemic will continue to keep customer additions under pressure. There will be some important earnings announcements too to keep the markets buzzing.

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

Nifty Top volumes

• Bharti Airtel is conceptualizing 5G trials in association with OEMs and application developers. 
• Sun Pharma's wholly owned subsidiary company -- Taro Pharmaceutical Industries has agreed to acquire all outstanding shares of Aquinox Pharmaceuticals (Canada) Inc. 
• NTPC has achieved highest daily gross generation of 977.07 Million Unit on July 28, 2020. 
• IndusInd Bank's board has approved a proposal to raise Rs 3,288 crore through a preferential issue of fully paid up 6.275 crore equity shares.