Indian equity benchmarks ended higher for the second consecutive day on Wednesday, led by gains in Utilities, Power and Telecom stocks. After making a slightly positive start, markets soon gained some strength as traders took encouragement with the India Meteorological Department (IMD) stating that India's stalled monsoon is likely to gain momentum in the next 3-4 days and could cover key rice, soybean, cotton and sugarcane growing regions in the southern, central and western states. Traders got some support as a labour bureau has said that retail inflation for farm workers and rural labourers eased to 5.99 per cent and 5.84 per cent, respectively, in May 2023. However, markets pared all the opening gains and traded lower in late morning deals, as some concern came with provisional data from the National Stock Exchange showing that foreign institutional investors (FII) sold shares worth Rs 1,942.62 crore on June 20. Some cautiousness also came as a private report said that though few fear a moderate rain deficit to impact inflation, an intense El Nino that severely disrupts the monsoon could push inflation up by 15-20 basis points by boosting food prices. But selling proved short-lived as markets once again moved to the green in afternoon deals, as some optimism came among traders with the Retirement fund body, Employees' Provident Fund Organisation (EPFO) in its latest Provisional Estimate of Net Payroll data report showing that India created 1719998 new jobs in the month of April 2023. During 2022-23, EPFO has added 1.39 crore net members as compared to the net addition of 1.22 crore during 2021-22. Traders took a note of the World Economic Forum's annual Gender Gap Report, 2023, which said India has ranked at 127 out of 146 countries in terms of gender parity -- an improvement of eight places from last year. Meanwhile, the RBI said its recent instructions on compromise settlements and technical write-offs have rationalised the existing regulatory guidance to banks and tightened some of the related provisions to ensure greater transparency. Finally, the BSE Sensex rose 195.45 points or 0.31% to 63,523.15 and the CNX Nifty was up by 40.15 points or 0.21% to 18,856.85.

The US markets ended lower for third straight day on Wednesday with Nasdaq settling over cut of one percent. Renewed concerns about the outlook for interest rates contributed to the weakness on markets following remarks by Federal Reserve Chair Jerome Powell. In testimony before the House Financial Services Committee, Powell reiterated the Fed is likely to continue raising interest rates in an effort to contain stubbornly elevated inflation. The Fed left rates unchanged last week, but the central bank's latest projections suggest it plans to resume raising rates later this year, forecasting a rate of 5.6 percent by the end of 2023. If the Fed decided to revert to its recent quarter-point increases, the forecast suggests the central bank will raise rates two more times this year. The forecast for additional rate hikes come as Powell noted inflation pressures continue to run high and said the process of getting inflation back to the Fed's 2 percent target has a long way to go. On the sectoral front, Semiconductor stocks saw substantial weakness on the day, resulting in a 2.7 percent slump by the Philadelphia Semiconductor Index. The index continued to give back ground after ending last Wednesday's trading at its highest closing level in over year. Networking, software and computer hardware stocks also showed significant moves to the downside, contributing to the steep drop by the tech-heavy Nasdaq.

Crude oil futures ended sharply higher on Wednesday amid hopes about the outlook for demand in the U.S. and forecasts for a drawdown in U.S. crude stocks last week. A private report estimated that a drop of about 400,000 barrels of crude stocks in the U.S. in the week to June 16. Meanwhile, Traders also noted the hawkish comments from Fed Chair Jerome Powell, who reiterated before the House Financial Services Committee that the central bank is likely to continue raising rates to contain inflation. The central bank's latest projections suggest it plans to resume raising rates later this year, forecasting a rate of 5.6% by the end of 2023. Benchmark crude oil futures for July delivery rose $2.03 or about 2.79 percent to settle at $72.53 a barrel on the New York Mercantile Exchange. Brent crude for August delivery surged $1.22 or 1.60 percent to settle at $77.12 a barrel on London's Intercontinental Exchange. 

Indian rupee ended higher against the US dollar on Wednesday as a positive trend in domestic equities and easing crude oil prices supported investor sentiments. Traders got support after a labour bureau has said that retail inflation for farm workers and rural labourers eased to 5.99 per cent and 5.84 per cent, respectively, in May 2023. Point-to-point rate of inflation based on the CPI-AL (consumer price index-agricultural labourers) and CPI-RL (rural labourers) stood at 6.50 per cent and 6.52 per cent respectively in April 2023 and 6.67 per cent and 7.00 per cent respectively during the corresponding month (May 2022) of the previous year. On the global front, Russian rouble strengthened on Wednesday ahead of three OFZ treasury bond auctions by the finance ministry, paring some of the previous day's losses as oil prices recovered. Finally, the rupee ended at 82.02 (Provisional), stronger by 7 paise from its previous close of 82.09 on Tuesday.

The FIIs as per Wednesday's data were net buyers in equity segment, while net sellers in debt segment. In equity segment, the gross buying was of Rs 12310.40 crore against gross selling of Rs 6443.99 crore, while in the debt segment, the gross purchase was of Rs 319.93 crore against gross selling of Rs 702.03 crore. Besides, in the hybrid segment, the gross buying was of Rs 4.16 crore against gross selling of Rs 10.82 crore.

The US markets ended lower on Wednesday as Fed Chair Jerome Powell hinted at further rate increases until inflation was tamed. Asian markets are trading mixed on Thursday mirroring overnight selling pressure on Wall Street. Indian markets ended higher on Wednesday propelled by sustained inflows from foreign portfolio investors (FPIs) and gains in index heavyweights. Today, start of the session is likely to be cautious tracking lackluster global cues. There will be some volatility in the markets amid the weekly expiry of Nifty derivatives contract. Meanwhile, the Securities and Exchange Board of India (Sebi) has restrained 135 entities from accessing the securities market and directed them to impound around Rs 126 crore of wrongful gains from alleged market manipulation done through bulk SMSes. However, foreign fund inflows likely to aid domestic sentiments. Provisional data from the National Stock Exchange shows foreign institutional investors (FII) bought shares worth Rs 4,013.10 crore on June 21. Some support may come with a private report that India, given its huge market size and growth potential, is no longer an option for global companies but has turned into a key investment destination. Traders may take note of the World Economic Forum's annual Gender Gap Report, 2023 showing that India has ranked at 127 out of 146 countries in terms of gender parity -- an improvement of eight places from last year. The World Economic Forum (WEF) ranked India at 135 out of 146 countries in the Global Gender Gap Index in the report's 2022 edition. Real estate industry stocks will be in focus as a report by rating agency CRISIL stated that the residential real estate sector across the top six cities of India - Mumbai, Delhi NCR, Bengaluru, Pune, Kolkata, and Hyderabad - is expected to clock 8-10 per cent sales growth this fiscal year. It noted that buoyant residential demand across all segments has resulted in robust sales growth in the past two financial years. There will be some reaction in textile industry stocks as Union Minister Piyush Goyal urged the industry to collaborate and partner for research and development and innovation to jointly achieve greater strides in the textiles sector. Besides, the food ministry said the government's rice procurement has reached 55.8 million tonnes so far in the ongoing 2022-23 marketing season, benefitting 1.22 crore farmers with MSP of Rs 1.7 lakh crore. Wheat procurement has reached 26.2 million tonnes so far in the 2023-24 rabi marketing year (April-March), more than the last year's total procurement of 18.8 million tonnes.

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

Nifty Top volumes

• State Bank of India's wholly owned subsidiary -- SBI Capital Markets has opened its new corporate office in Bandra Kurla Complex, shifting from Cuffe Parade, Mumbai. 
• The CCI has approved acquisition of additional shareholding of HDFC Life Insurance Company by HDFC. 
• Bajaj Finserv's subsidiary -- Bajaj Markets has partnered with SmartCoin to offer personal loans at interest rates starting from 2% per month.
• Kotak Mahindra Bank has become the first bank clearing member to clear and settle FPI trades in the Exchange Traded Commodities Derivatives segment on MCX.