Indian equity indices ended volatile session in green terrain on Wednesday, with Sensex and Nifty keeping their heads above crucial psychological levels of 39,800 and 11,900, respectively. Markets made a cautious start of day, as the finance minister stated that India's state-owned banks had classified Rs 1.50 trillion ($21.76 billion) worth of loans as wilful defaults in 2018-19, with the biggest lender State Bank of India accounting for nearly a third. Adding worries among traders, India's services sector activity contracted in the month of June, as weak sales, competitive pressures and unfavourable taxation all hampered output. As per the survey report, the seasonally adjusted Nikkei Services Business Activity Index eased to 49.6 in June from 50.2 in May. However, bourses remained in green for the most part of the day and ended higher, amid reports that Commerce Minister Piyush Goyal took a decision to set up a Cooperative Sector Exports Promotion Forum (CSEPF) under the National Cooperative Development Corporation (NCDC) which will work with 20 states and union territories in the area of export to achieve an agriculture export target of $60 billion by 2022. Some support also came with after Union Minister of Skill Development and Entrepreneurship Mahendra Nath Pandey said that in coming months about 2.5 lakh new jobs will be created in the IT sector through the comprehensive skill Development programme. Finally, the BSE Sensex gained 22.77 points or 0.06% to 39,839.25, while the CNX Nifty was up by 6.45 points or 0.05% to 11,916.75.

The US markets ended higher with gains of over half percent on Wednesday, during a holiday-abridged trading session, as a batch of largely disappointing US economic data reinforced expectations for a near-term interest rate cut by the Federal Reserve. Initial buying interest was generated in reaction to a report from payroll processor ADP showing private sector job growth reaccelerated in the month of June but still came in below Street estimates. ADP said private sector employment climbed by 102,000 jobs in June after rising by an upwardly revised 41,000 jobs in May. Street had expected employment to increase by about 140,000 jobs compared to the addition of 27,000 jobs originally reported for the previous month. Stocks saw further upside after a report from the Institute for Supply showing a notable slowdown in the pace of service sector growth added to the optimism about a rate cut. The ISM said its non-manufacturing index dropped to 55.1 in June from 56.9 in May, hitting its lowest level since a matching reading in July of 2017. While a reading above 50 still indicates growth in service sector activity, Street had expected the index to show a more modest decrease to 55.9. A separate report released by the Commerce Department showed the US trade deficit widened by more than anticipated in the month of May, as the value of imports jumped by much more than the value of exports. The Commerce Department said the trade deficit widened to $55.5 billion in May from a revised $51.2 billion in April. The wider trade deficit came as the value of imports surged up by 3.3 percent to $266.2 billion compared to a 2.0 percent jump in the value of exports to $210.6 billion. Dow Jones Industrial Average surged 179.32 points or 0.67 percent to 26966.00, Nasdaq gained 61.14 points or 0.75 percent to 8170.23 and S&P 500 was up by 22.81 points or 0.77 percent to 2995.82.

Crude oil futures ended higher on Wednesday as US government data showed domestic crude supplies fell a third straight week, but by a lot less than the market expected. The Energy Information Administration (EIA) reported that US crude supplies declined by 1.1 million barrels for the week ended June 28. S&P Global Platts expected a fall of 3.7 million barrels in crude stocks, on average. The American Petroleum Institute on July 2 reported a 5 million-barrel decline. The EIA data also showed that gasoline inventories were down 1.6 million barrels, while distillate stockpiles edged up by 1.4 million barrels last week. Benchmark crude oil futures for August surged $1.09 or 1.9 percent to settle at $57.34 a barrel on the New York Mercantile Exchange. September Brent rose $1.42 or 2.3 percent to settle at $63.82 a barrel on London's Intercontinental Exchange.

Indian rupee gave away most of its gains to end tad higher against dollar on Wednesday, driven by weakening of the greenback in overseas markets. Traders found some solace with Finance Minister Nirmala Sitharaman's statement that India still continues to be the fastest growing economy and demonetisation has had no effect on the Indian economy. Besides, the dollar losing muscle against other currencies overseas too helped the domestic currency. But most of the gains were trimmed as participants preferred to sit on the fence ahead of the Union Budget due on July 5. On the global front, dollar slipped to a one-week low against the Japanese yen on Wednesday, undermined by the steady fall in U.S. Treasury bond yields, fading optimism over the Sino-U.S. trade deal and the possibility of fresh tariff hostilities with Europe. Finally, the rupee ended at 68.89, 6 paise stronger from its previous close of 68.95 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 4070.93 crore against gross selling of Rs 5624.04 crore, while in the debt segment, the gross purchase was of Rs 1737.21 crore with gross sales of Rs 461.94 crore. Besides, in the hybrid segment, the gross buying was of Rs 6.97 crore against gross selling of Rs 1.04 crore.

The US markets ended in green on Wednesday as investor cheered the prospect of looser monetary policy at the world's major central banks. Asian markets are treading mostly higher on Thursday amid further comments on Chinese and European currency manipulation by President Donald Trump. Indian markets ended choppy trading session tad higher on Wednesday as weak global data hurt sentiment, while investors awaited positive cues from the budget due later this week. Today, the start of session is likely to be in green tracking positive trend in global markets. All eyes will be on important event of the release of Economic Survey report which will be tabled in Parliament later in the day. The survey prepared by Chief Economic Adviser Krishnamurthy Subramanian is likely to flag headwinds that the economy might face in its pursuit to become the world's fifth largest economy. Traders will be getting some encouragement with commerce & industry minister Piyush Goyal's statement that India will get additional $217 million of revenue from the retaliatory tariffs it imposed on 28 American products. With the retaliatory tariffs, maximum duty of $98.7 million will come from imports of almonds on which 17% additional duty is imposed followed by $24.5 million duty from 20% higher tax on diagnostic reagents. Some support will also come as the Union Cabinet approved the Code on Wages Bill which seeks to subsume existing laws related to workers remuneration and enable the Centre to fix minimum wages for the entire country. The Code on Wages is one of the four codes that would subsume 44 labour laws with certain amendments to improve the ease of doing business and attract investment for spurring growth. Meanwhile, the Reserve Bank has constituted a working group that will review the regulatory and supervisory framework for core investment companies. Besides, the tax department has extended by three months till July 31 the deadline for service providers with turnover of up to Rs 50 lakh to opt for the composition scheme and pay six per cent goods and services tax (GST). There will be some buzz in the agriculture stocks with the Union Cabinet giving its nod to hike the minimum support price (MSP) for kharif crops. MSP of paddy increased by Rs 65 per quintal, Jowar by Rs 120 per quintal and Ragi by Rs 253 per quintal. There will be some reaction in telecom stocks with report that telecom operators need to be financially sound to build up infrastructure and there is a need to review the auction architecture as they cannot pay high prices for spectrum.

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

Nifty Top volumes

• Bharti Airtel, Bharti Enterprises have infused worth Rs 325 crore in Airtel payments bank. 
• Tech Mahindra has entered into a strategic partnership with SSH.com to deploy cutting edge cybersecurity solutions to secure access control for enterprises. 
• M&M's FES has reported domestic tractor sales of 31,879 units in June 2019, as against 39,277 units during June 2018, registering a fall of 19%. 
• Reliance Industries is planning to invest around Rs 1,500 crore in its proposed university, Jio Institute, in the next two years.