Indian equity bourses witnessed bloodbath on Tuesday, with Sensex & Nifty plunging around 1.65% each. After a cautious start of the day, key indices remained bearish throughout the day, as the government data showed that India's factory output growth, measured by the Index of Industrial Production, slowed down for second straight month to 2.0% in June 2019 as compared to 7% in June 2018 & it is also lower than 3.1% in May 2019. The slowdown was mainly due to poor performance of the manufacturing & mining sectors and a contraction in the capital goods & consumer durables sectors. Traders also remained on sidelines ahead of Consumer Price Index-based inflation data for July later in the day. Markets extended their losses in the second half of the trading session to end near their intraday lows points, tracking weak global markets. Market participants were cautious, amid a private report stating that the Reserve Bank of India is unlikely to vote in favour of overseas sovereign bonds at its meeting with the government. The central bank is concerned that signals by overseas bonds could disrupt local bonds, which are controlled by the RBI. The mood of street remained down, even though Finance Minister Nirmala Sitharaman assured industry leaders that the Reserve Bank of India and the government are on the same page as regards to efforts that are required to boost the economy. Finally, the BSE Sensex lost 623.75 points or 1.66% to 36,958.16, while the CNX Nifty was down by 183.80 points or 1.65% to 10,925.85.

The US markets ended sharply higher on Tuesday after the Trump administration backed off on imposing tariffs on some Chinese imports from September 1, following recent sharp falls in equity markets and ahead of a politically damaging rise in prices for consumer goods later this year on account of the proposed levies. Products that will not be subject tariffs from September include cell phones, laptop computers, video game consoles, certain toys, computer monitors, and certain items of footwear and clothing. The delays mean that goods worth $152 billion, or more than half of the original $300 billion list, will now not be hit with tariffs until mid-December. A report of a de-escalation in the trade war overshadowed concerns about slowing economic growth and the potential for Beijing to crack down on protests in Hong Kong, one of Asia's most important financial and trade hubs. On the economic front, consumer prices in the US rose in line with economist estimates in the month of July, according to a report released by the Labor Department. The Labor Department said its consumer price index climbed by 0.3 percent in July after inching up by 0.1 percent in both May and June. Street had expected prices to rise by 0.3 percent. The faster price growth was partly due to a significant rebound in energy prices, which surged up by 1.3 percent in July after plunging by 2.3 percent in June. Meanwhile, food prices were unchanged for the second month in a row, as a decline in the food at home index was offset by an increase in the food away from home index. Excluding food and energy prices, core consumer prices rose by 0.3 percent for the second consecutive month, while Street had expected a 0.2 percent uptick. Dow Jones Industrial Average rose 372.54 points or 1.44 percent to 26279.91, Nasdaq surged 152.95 points or 1.95 percent to 8016.36 and S&P 500 was down by 42.57 points or 1.48 percent to 2926.32.

Crude oil futures end higher with gain of four percent on Tuesday, following reports that the US will delay tariffs on certain Chinese products until December, as the two nations look to continue discussions on trade, easing fears about a global economic slowdown. The US will delay imposing 10% tariffs on certain Chinese products, including cellphones and laptop computers, until December 15. However, the Energy Information Administration (EIA) said it expected US oil production in the shale regions to rise to 8.768 million barrels a day in September, an increase of 85,000 barrels a day from August. Benchmark crude oil futures for September surged $2.17 or 4 percent to settle at $57.10 a barrel on the New York Mercantile Exchange. October Brent rose $2.73 cents or 4.7 percent to settle at $61.30 a barrel on London's Intercontinental Exchange.

Indian rupee fell to nearly 6-month low against dollar on Tuesday, amid rising geopolitical tensions across the globe. Market participants were cautious as the government data showed that India's factory output growth, measured by the Index of Industrial Production, slowed down for second straight month to 2.0% in June 2019 as compared to 7% in June 2018 & it is also lower than 3.1% in May 2019. Traders also remained wary ahead of Consumer Price Index (CPI) data for July scheduled to be released today. Heavy selling in domestic equities also kept pressure on the Indian rupee. Besides, dollar weakened against other currencies overseas failed to cast any impact on the rupee. On the global front, yen stood near a seven-month high against the dollar on Tuesday as unrest in Hong Kong and gyrations in Argentina's markets heightened investor risk aversion and fanned demand for the safe-haven Japanese currency. Finally, the rupee ended at 71.40, 62 paise weaker from its previous close of 70.78 on Friday.

The FIIs as per Tuesday'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 4756.02 crore against gross selling of Rs 5502.36 crore, while in the debt segment, the gross purchase was of Rs 601.15 crore with gross sales of Rs 518.20 crore. Besides, in the hybrid segment, the gross buying was of Rs 4.91 crore against gross selling of Rs 17.98 crore.

The US markets ended higher on Tuesday after the United States said it would delay tariffs on some Chinese products, easing concerns that a protracted trade war would harm global growth. Asian markets are trading in green on Wednesday following overnight gains on Wall Street. Indian markets snapped tow-day winning streak and ended lower with cut of around two percent each amid a selloff across sectors barring energy shares coupled with subdued global markets. Today, the markets are likely to make slightly positive start tracking firm cues from global markets. Traders will be getting encouragement with the government data showing that the retail price inflation rate inched down to 3.15 per cent in July against 3.18 per cent in the previous month, owing to a fall in energy prices. This was the first time in six months that the inflation rate dipped. The marginal dip was despite the food inflation rate rising slightly to 2.36 per cent from 2.25 per cent during this period. Some support may also come with report that the slowdown-hit economy may soon get a booster dose from the government with Finance Ministry working on a stimulus package for the industry may include a slew of financial measures ranging from tax cuts, subsidies and other incentives. Investors will be taking note of a report that the finance ministry may soon consult the law ministry on how best to provide relief to foreign portfolio investors (FPIs) from the super-rich surcharge that was announced in the July 5 budget. Besides, the Reserve Bank of India (RBI) has permitted startups, banks and financial institutions to set up regulatory sandbox (RS) for live testing of innovative products in areas like retail payments, digital KYC and wealth management. There will be some buzz in the housing finance companies (HFCs) stocks with the Reserve Bank of India's (RBI) statement that HFCs will be treated as one of the categories of NBFCs for regulatory purposes and it will come under its direct oversight. There will be some reaction in auto stocks with report that sales of passenger vehicles declined by 30.98 per cent, the steepest fall in two decades, and industry executives are now counting on a good monsoon to revive them in the festive season.

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

Nifty Top volumes

• Reliance Industries' telecom arm -- Jio is all set to launch ‘Jio Fiber' from September 05, 2019. 
• M&M's MANA has signed a LoI with RACER Trust to evaluate the former Buick City site for a new manufacturing plant in Flint, Michigan. 
• Tech Mahindra is planning to pay about Rs 490 crore to acquire 65 per cent stake in US-based strategic design consultancy firm MadPow. 
• Tata Motors Group's global wholesales in July 2019, including Jaguar Land Rover, were at 78,600 nos lower by 14%, as compared to July 2018.