Wednesday turned out to be a daunting day of trade for Indian equity benchmarks where frontline gauges clobbered out of shape, tumbling below their crucial 31,200 (Sensex) and 9,750 (Nifty) levels, as traders opted to remain on sidelines on penultimate day of September F&O expiry. Markets failed to take any advantage of positive start and soon entered into negative terrain. Afterwards, market never looked confident of recovering and gradually extended its losses till end to close near intraday lows, as sentiments remained dampened on report that collections under goods and services tax declined to Rs 90,669 crore for August from a revised figure of Rs 94,063 crore for July. Of the tax collected, Rs 14,402 crore have come in as Central GST, Rs 21,067 crore as State GST and Rs 47,377 crore as Integrated GST, which is levied on inter-state movement of goods and imports and Rs 7,823 crore as compensation cess. Some cautiousness also crept with report that the Asian Development Bank (ADB) expecting the RBI to go for another round of rate cut in the latter part of 2017-18 in view of sluggish economic activities but does not see possibility of any major fiscal stimulus. Markets extended losses in last leg of trade on report that India slipped one place to rank 40th in Global Competitiveness Index out of 137 countries surveyed, while Switzerland, the US and Singapore were ranked as the top three countries. Meanwhile, the Indian Army has conducted another surgical strike at Naga Insurgent Camp, Myanmar border. There was no casualty to Indian forces during surgical strike but there are heavy casualties at Naga Insurgent camp in Myanmar border. Traders overlooked Niti Aayog Vice Chairman Rajiv Kumar's statement that the extra fiscal stimulus will help the economy do well and there is no harm in relaxing the fiscal deficit target to allow for more capital expenditure in order to lift the slowing Indian economy. Finally, the BSE Sensex declined 439.95 points or 1.39% to 31,159.81, while the CNX Nifty was down by 135.75 points or 1.38% to 9,735.75.

The US markets closed higher on Wednesday, with the Dow industrials ending a four-day losing streak as President Donald Trump and congressional Republicans touted a sweeping tax overhaul. Republican leaders unveiled a plan to overhaul the US tax code that looks to sharply reduce tax rates on businesses and many individuals. One of the reasons markets have risen throughout 2017 is the prospect of tax reform passing, which is expected to be a tailwind for markets. However, the Republican-controlled Congress was unable to pass health-care reform despite several attempts and versions, and it is unclear how likely it was that tax-reform could be passed. On the economy front, orders for durable or long-lasting goods such as passenger planes rose sharply in August and business investment strengthened again in a good showing for the US economy. Durable-goods orders climbed 1.7% last month. The increase stemmed mainly from a big batch of orders for commercial aircraft. Bookings surged 45%. Demand was higher for most other manufactured goods, but bookings grew at a slower pace. Orders minus transportation edged up 0.2%. A key measure of business investment, meanwhile, showed more muscle. So-called core capital-goods orders advanced 0.9% and rose for the eighth time in the past nine months. The Dow Jones Industrial Average added 56.39 points or 0.25 percent to 22,340.71, the Nasdaq gained 73.1 points or 1.15 percent to 6,453.26, and the S&P 500 edged higher by 10.2 points or 0.41 percent to 2,507.04. 

Crude oil futures moved higher on Wednesday after data from the U.S. Energy Information Administration (EIA) showed domestic crude stockpiles declined for the first time in four weeks as refiners raised output. The EIA said in its weekly report that crude oil inventories fell by 1.8 million barrels in the week ended September 22. The report also showed that gasoline inventories rose by 1.1 million barrels, while distillate inventories including diesel, declined by 814,000 barrels. Total U.S. crude oil inventories stood at 471.0 million barrels as of last week, which the EIA considered to be at the upper half of the average range for this time of year. Benchmark crude oil futures for November delivery ended higher by $0.25 or 0.5 percent at $52.13 a barrel on the New York Mercantile Exchange. Brent crude for November delivery lost 26 cent to $57.66 a barrel on the ICE.

Caught in a downward spiral for the third straight session, Indian rupee ended considerably weaker against the US dollar on Wednesday, on account of heavy foreign fund outflows and month-end dollar demand. Investors remained cautious with report that the Asian Development Bank (ADB) expecting the RBI to go for another round of rate cut in the latter part of 2017-18 in view of sluggish economic activities but does not see possibility of any major fiscal stimulus. Some anxiety also spread among the investors as India has been ranked as the 40th most competitive economy -- slipping one place from last year's ranking -- on the World Economic Forum's global competitiveness index, which is topped by Switzerland. Moreover, the fall in the rupee was also triggered by dollar's appreciation overseas against a basket of major currencies along with extremely bearish local equity markets. On the global front, US dollar rose against yen on Wednesday, on expectation of a US rate hike by the end of this year. Finally, the rupee ended at 65.70, 26 paise weaker from its previous close of 65.44 on Tuesday.  

The FIIs as per Wednesday's data were net sellers in equity and debt segments both. In equity segment, the gross buying was of Rs 3807.82 crore against gross selling of Rs 5464.14 crore, while in the debt segment, the gross purchase was of Rs 1516.98 crore with gross sales of Rs 2147.97 crore.

The US markets showed some recovery and ended higher in the last session with the tech heavy Nasdaq outperforming its other counterparts, in a positive reaction to the release of a Republican tax reform plan, which calls for a reduction in the corporate tax rate to 20 percent. The Asian markets have once again made a mixed start with some indices trading in red, as investors began to assess the implications of the much-anticipated tax proposal. The Japanese market was though trading in green as the yen weakened against dollar on optimism over the health of the U.S. economy. The Indian markets got pummeled further and deposed another over a percent in last session with major benchmarks declining for the seventh straight session and losing their crucial support levels. Today, the start of the F&O series expiry session is likely to remain cautious with India Ratings' report that India's GDP growth estimate for the ongoing financial year 2017-18 is likely to come down to 6.7 per cent from 7.4 per cent earlier as “the combined effect of demonetisation and introduction of goods and services tax (GST) is proving to be more disruptive for the economy than was expected earlier. Traders will also be concerned with the rupee continuing its bear run and plunging to its lowest level in six-and-a-half months. Markets may see some recovery in the latter part of the trade as the traders will settle their positions and cover shorts going to new series. Also, there will be some support with Prime Minister Narendra Modi's statement that traders across the country are 'positive' about GST and accepting the new taxation arrangement but they need 'handholding' so that their problems can be resolved. He urged the chief secretaries to use the district administration in this regard, so that small traders are facilitated to access and adopt the new system. Niti Aayog vice chairman Rajiv Kumar too has said that the economic downturn which began in the last two years of UPA II regime has bottomed out and the growth will improve in the next two quarters. There will be some buzz in the telecom sector, as the Communications Minister Manoj Sinha has said that  the telecom industry is expected to generate revenue of $38.25 billion by 2017-end, registering a compounded annual growth rate of 5.2 percent between 2014 and 2017.

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

Nifty Top volumes

• Wipro has entered into partnership with CloudGenix Inc. to offer open and managed SD-WAN services.
• Hindustan Uniliver has forayed into e-commerce business. The company is planning to sell premium tea through its own portal.
• NTPC has successfully commissioned 50 MW capacity at its Rojmal Wind Energy Project in Gujarat.
• Larsen & Toubro's construction arm -- L&T Construction -- has won orders worth Rs 2170 crore across various business segments.