Indian equity benchmarks ended flat in the volatile session on Wednesday. Key gauges made a cautious start and traded lackluster throughout the day due to weak global cues, driven by concerns over an escalating trade conflict between the US and China. Traders also were cautious with Icra Ratings' report that states continue to pay higher interest rates to investors for their debt, with the latest weighted average cost rising to 7.46 per cent at Tuesday's auctions wherein nine states raised Rs 16,200 crore. Some concern also came as the growth in India's services sector declined in June owing to inflation. The headline figure in the Purchasing Managers' Index (PMI) survey by credit rating agency S&P Global declined to 58.5 in June from 61.2 in May. This is the lowest level since April when it was 62. However, traders took some support with provisional data from the National Stock Exchange showing that foreign institutional investors (FII) bought shares worth Rs 2,134.33 crore on July 4. Some support came with S&P Global Ratings analyst Neel Gopalakrishnan's statement that the companies tracked by the global rating agency S&P in India are in good credit shape due to strong underlying growth and accommodative balance sheets. Traders also took a note of report that Finance Minister Nirmala Sitharaman has reviewed progress of implementation of Budget schemes with secretaries of finance ministry and Corporate Affairs Secretary. Besides the review of implementation of various schemes of Union Budget, the minister underlined the importance of continuous assessment of progress to ensure that the schemes are implemented in a time bound manner. Finally, the BSE Sensex fell 33.01 points or 0.05% to 65,446.04 and the CNX Nifty was up by 9.50 points or 0.05% to 19,398.50.

The US markets ended in red on Wednesday after the minutes from the Federal Reserve's June meeting showed most members thought further hikes are on the way, but considering the lagged impact of policy and other concerns, chose to pause after enacting 10 straight rate increases. The minutes showed the officials felt that leaving the target range unchanged at this meeting would allow them more time to assess the economy's progress toward the Committee's goals of maximum employment and price stability. The minutes said that participants favoring a 25 basis point increase noted that the labor market remained very tight, momentum in economic activity had been stronger than earlier anticipated, and there were few clear signs that inflation was on a path to return to the Committee's 2 percent objective over time. Further, weakness also prevailed in the markets as the Commerce Department released a report showing new orders for U.S. manufactured goods increased by much less than expected in the month of May. The Commerce Department said factory orders rose by 0.3 percent in May after rising by a downwardly revised 0.3 percent in April. Street had expected factory orders to climb by 0.8 percent compared to the 0.4 percent increase originally reported for the previous month. On the stock specific developments, Intel dropped more than 3 percent and 3M ended lower by about 2.5 percent. Nike, Goldman Sachs, JP Morgan, United Health and Caterpillar lost 1 to 2 percent. However, Meta climbed more than 3 percent, hitting a 52-week high in the process. Microsoft ended modestly higher.

Crude oil futures ended higher on Wednesday as data from the Weekly Petroleum Status Report of the Energy Information Administration (EIA) showed crude exports rose to about 5.4 million barrels per day for the week ended June 23, after seeing a volume of 4.543 million barrels per day a week earlier. Further, support also came in as Saudi Arabia, the world's biggest crude exporter, on Monday said it would extend its voluntary output cut of 1 million barrels per day (bpd) to August. Russia and Algeria, meanwhile, are lowering their August output and export levels by 500,000 bpd and 20,000 bpd respectively. Benchmark crude oil futures for August delivery rose $2.00 or about 2.9 percent to settle at $71.79 a barrel on the New York Mercantile Exchange. Brent crude for September delivery gained $0.40 or 0.5 percent to settle at $76.65 a barrel on London's Intercontinental Exchange.

Indian rupee weakened against the US dollar on Wednesday weighed down by a weak tone in local equity markets and disappointing domestic macroeconomic data. Traders were worried after India's services sector activity eased to a three-month low in June but remained above the neutral level of 50.0, amid stronger increase in new business volumes. As per the survey report, the seasonally adjusted S&P Global India Services PMI Business Activity Index fell at 58.5 in June from 61.2 in May. Further, the S&P Global India Composite PMI Output Index -- which measures both manufacturing and services -- eased to 59.4 in June as against 61.6 in May. On the global front, the U.S. dollar was treading water against other major currencies on Wednesday as traders waited for the release of minutes from the Federal Reserve's last meeting that could offer clues to the outlook for interest rates. Finally, the rupee ended at 82.23 (Provisional), weaker by 22 paise from its previous close of 82.01 on Tuesday.

The FIIs as per Wednesday's data were net buyers in both equity and debt segment. In equity segment, the gross buying was of Rs 9335.74 crore against gross selling of Rs 6820.41 crore, while in the debt segment, the gross purchase was of Rs 578.36 crore against gross selling of Rs 524.12 crore. Besides, in the hybrid segment, the gross buying was of Rs 2.86 crore against gross selling of Rs 8.59 crore.

The US markets ended lower on Wednesday as investors digested minutes from the US Federal Reserve's latest meeting and braced for significant economic data in the days to come. Asian markets are trading mostly in red on Thursday following overnight losses on Wall Street. Indian markets ended flat on Wednesday after an unabated record-breaking rally in the last few trading sessions, as weak global market trends and fall in HDFC twins spoiled markets. Today, start of the session is likely to be pessimistic tracking weakness in global peers and as investors worry about the impact of rising interest rates on economic growth. There will be some volatility in the session amid weekly F&O expiry later in the day. However, foreign fund inflows likely to aid domestic sentiments. According to the provisional data available on the NSE, foreign institutional investors (FII) bought shares worth a net Rs 1,603.15 crore, on 5 July. Some support may come as a report released by United Nations Conference on Trade and Development (Unctad) showed that Foreign Direct Investment (FDI) flows into India rose by 10 per cent to $49 billion in 2022, making it the third largest host country for announced greenfield projects and the second largest for international project finance deals. Traders may take note of G20 Sherpa Amitabh Kant's statement that high growth of 8-9 per cent could be driven by focus on manufacturing and urbanisation. Meanwhile, the commerce and industry ministry has worked out a detailed plan to promote trade and investment and identified 12 countries including the US and UK for priority action. Besides, a Reserve Bank-appointed committee has suggested a host of short-term and long-term measures for internationalisation of Indian rupee, including efforts for inclusion of the Indian currency in IMF's Special Drawing Rights (SDR) basket. Banking stocks will be in focus ahead of Finance Minister Nirmala Sitharaman's meeting with the chiefs of public sector banks (PSBs) to review their financial performance later in the day. As per reports, the finance minister is likely to ask the chiefs of public sector banks to focus on the areas highlighted by the Budget, including credit flow to productive sectors. There will be some reaction in FMCG stocks as ratings agency CRISIL said the fast-moving consumer goods (FMCG) sector in India is likely to witness a revenue growth of 7 to 9 per cent in 2023-24 (FY24), marginally lower than 8-9 per cent in the last two years.

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

Nifty Top volumes

• Tata Steel is expanding its digital services with the launch of Urja, its flagship unsecured working capital finance programme, on DigECA.
• HDFC Bank has reported 15.8% rise in its advances to around Rs 16,155 billion as of June 30, 2023 as compared to Rs 13,951 billion as of June 30, 2022. 
• State Bank of India has received an approval from the ECCB of the Bank for acquiring the entire stake held by SBI Capital Markets in SBICAP Ventures. 
• Maruti Suzuki's premium channel -- NEXA has expanded its horizons with the launch of the INVICTO, a premium three row UV with the bold impressions of an SUV.