Wednesday turned out to be a disappointing day of trade for Indian equity benchmarks with frontline gauges resuming their southward journey after a day of halt and settled with a cut of over half a percent. Markets started the session on quiet note as traders remained cautious with the government data showing that foreign direct investment (FDI) into India dipped marginally by 1.4% to $10.67 billion (about Rs 76,800 crore) during October-December period of 2019-20. Inflow of FDI during October-December of 2018-19 stood at $10.82 billion. Meanwhile, the government has collected over Rs 7.52 lakh crore as direct taxes till January 31 of the current fiscal. Key gauges lost some more ground as traders shrugged off report that the Indian services sector growth jumped to over 7-year high in the month of February 2020, with rise new export orders and strengthening business confidence. The IHS Markit India Services Business Activity Index increased for the fifth successive month in February to 57.5 from 55.5 in January after dipping to a 19-month low in September 2019. The market participants even overlooked Minister of State for Agriculture Kailash Chaudhary's statement that the government's target of doubling of farmers' income by the year 2022 will definitely be achieved. He also said that a number of schemes have been launched by the government towards fulfilling this goal. In late trade, markets suddenly collapsed like house of card as coronavirus cases increased in India. Union Health Minister Harsh Vardhan said the number of confirmed cases in India have risen to 28 and the government is readying an action plan. But, decent recovery in last leg of trade helped markets to end off day's lows as traders opted to buy beaten down but fundamentally strong stocks. Though the recovery was not enough to pull markets into green. Finally, the BSE Sensex slipped 214.22 points or 0.55% to 38,409.48, while the CNX Nifty was down by 52.30 points or 0.46% to 11,251.00.

The US markets ended sharply higher on Wednesday, more than offsetting the steep losses posted in the previous session, as investors warmed to the Federal Reserve's surprise interest rate cut and support from other central banks, as well as former Vice President Joe Biden emerging as the frontrunner of the Democratic Party's presidential race. Adding to the positive sentiment, the Institute for Supply Management (ISM) released a report showing service sector growth unexpectedly accelerated to a one-year high in February. The ISM said its non-manufacturing index climbed to 57.3 in February from 55.5 in January, with a reading above 50 indicating growth in service sector activity. The increase by the reading on service sector activity came as a surprise to participants, who had expected the index to edge down to 54.9. With the unexpected uptick, the non-manufacturing index reached its highest level since hitting 58.5 in February of 2019. A separate report from payroll processor ADP released showed private sector employment increased by more than expected in the month of February, although the report also showed a notable downward revision to the surge in jobs in the previous month. ADP said private sector employment climbed by 183,000 jobs in February compared to street estimates for an increase of about 170,000 jobs. However, the report also showed the spike in jobs in January was downwardly revised to 209,000 from the previously reported 291,000. 

Crude oil futures ended lower on Wednesday after the Energy Information Administration (EIA) reported a sixth straight weekly rise in US crude supplies. US crude supplies rose by 785,000 barrels for the week ended February 28. The government agency had reports increases in each of the previous five weeks. A report released by the American Petroleum Institute on Tuesday showed US crude oil inventories rose by 1.7 million barrels in the week to Feb. 28 to 446.6 million barrels. Meanwhile, oil prices also fell as oil producers struggled to reach an agreement on production cuts in Vienna in an effort to stabilize prices on the heels of a demand slowdown sparked by the COVID-19 epidemic. Crude oil futures for April dropped 40 cents or about 0.9 percent to settle at $46.78 a barrel on the New York Mercantile Exchange. May Brent crude fell 73 cents or 1.4 percent to settle at $51.13 a barrel on London's Intercontinental Exchange.

Indian rupee pared most of its early losses but still weakened marginally against the American currency on Wednesday, due to fresh dollar demand from banks and importers. Investor sentiment remained fragile amid concerns over the impact of coronavirus. Union Health Minister Harsh Vardhan said the numbers of confirmed cases in India have risen to 28 and the government is readying an action plan. Traders also remained cautious as foreign direct investment (FDI) into India dipped marginally by 1.4% to $10.67 billion (about Rs 76,800 crore) during October-December period of 2019-20. However, local unit cut most of the early losses, taking support from the survey report showing that India's services sector growth jumped to over 7-year high in the month of February 2020, with rise new export orders and strengthening business confidence. The IHS Markit India Services Business Activity Index increased for the fifth successive month in February to 57.5 from 55.5 in January after dipping to a 19-month low in September 2019. On the global front, euro held near two-month highs and the dollar recouped some losses on Wednesday as traders evaluated the impact of an emergency Fed rate cut a day earlier. The last traded price of rupee was 73.22, 3 paise weaker from its previous close of 73.19 on Tuesday.

The FIIs as per Wednesday's data were net sellers in both equity and debt segments. In equity segment, the gross buying was of Rs 5694.86 crore against gross selling of Rs 8023.75 crore, while in the debt segment, the gross purchase was of Rs 592.69 crore with gross sales of Rs 2178.36 crore. Besides, in the hybrid segment, the gross buying was of Rs 12.10 crore against gross selling of Rs 18.70 crore.

The US markets settled sharply higher on Wednesday as major victories from former Vice President Joe Biden during Super Tuesday sparked a massive rally within the health-care sector. All the Asian markets are trading in green on Thursday after an emergency US spending bill to combat the impact of the coronavirus added to signs of support from policy makers around the world. Indian markets ended highly volatile session in red on Wednesday as rising cases of deadly coronavirus in the country dampened investors' sentiment. Today, the markets are likely to make flat-to-positive start following global peers after the International Monetary Fund (IMF) announced a $50 billion aid package on Wednesday to combat the impact of the coronavirus. Some encouragement will come as Reserve Bank of India (RBI) governor said he's ready to act to shield the economy from the coronavirus and reiterated there's room to cut interest rates if needed. He added that for India, options include a rate cut and supporting the market through liquidity measures. Some support will also come with report that the Union Cabinet has approved 72 changes to the Companies Act 2013, with a thrust on decriminalising compoundable offences and allowing direct foreign listing for domestic companies to boost Brand India. However, some cautiousness may come with IMF chief Kristalina Georgieva's statement that the new coronavirus epidemic poses a serious threat to people and the world economy, and will slow growth below the 2.9% posted last year. Traders may take note of Chief Economic Adviser K V Subramanian's statement that the country need far more competition to come into business to accelerate growth, as the evidence from the past shows that wealth creation and growth has accelerated after the market was opened up. Meanwhile, Union Finance Minister Nirmala Sitharaman has said the Cabinet has approved 72 changes amending 65 sections of the Companies Act, to decriminalize these sections. There will be some buzz in the metal stocks with a private report stating that steel mills in India are gearing up for an increase in demand from overseas buyers as the coronavirus outbreak chokes supplies from China. Banking stocks will be in focus after the Union Cabinet gave its go-ahead for the merger of ten public sector banks. There will be some reaction in textile stocks as ratings agency ICRA said it is maintaining negative outlook on the cotton spinning sector amid uncertainty over the extent and duration of the coronavirus outbreak. Telecom stocks may also in limelight after reports that the Department of Telecommunications has ordered Vodafone Idea, Bharti Airtel and other telecom operators to immediately clear all dues to the government arising from the Supreme Court's October order. 

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

Nifty Top volumes

• Tech Mahindra's subsidiary -- Comviva Technologies has agreed to sell its 100% shareholding in Terra Payment Services (Netherlands) BV along with its subsidiaries. 
• Maruti Suzuki has partnered with HDB Financial Services to provide customized and attractive car loans for customers. 
• L&T's construction arm -- L&T Construction's Water & Effluent Treatment Business has secured an order from a prestigious client in the Sultanate of Oman for the design and execution of a water infrastructure project. 
• SBI's board has approved resolution plan for Reliance Communications, through which lenders are expected to recover around Rs 23,000 crore.