Indian equity benchmarks ended flat with negative bias after a highly volatile session on Tuesday. After making slightly positive start, markets soon slipped into red territory, as traders were concerned as India reported 31,222 new cases of Covid-19 and 290 deaths from the disease in 24 hours. Some cautiousness also came in as a private report projected a real gross value added (GVA) growth of 7 to 8 per cent year-on-year in the second quarter of current fiscal year versus 20.1 per cent growth in Q1 FY22. It said estimates suggest some moderation in economic activity index (EAI)-GVA growth in July, largely on account of weaker fiscal spending. Traders took note of a private report stated that industries have raised red flags over fresh notices being issued denying input tax credit (ITC), alleging wrongful claims, in turn leading to hardships for businesses. The markets, however, surrendered all their losses to trade in the positive note in noon session, taking support from RBI's data showing that sales of 1,647 listed private manufacturing companies recorded extraordinarily high growth of 75 per cent in the first quarter of FY'22 mainly due to a very low base in the pandemic-hit year-ago period. Some support also came with report stated that sales growth (y-o-y) of information technology (IT) sector companies, which remained in the positive terrain throughout the pandemic, accelerated to 17.5 per cent in first three months period of 2021-22 from 6.4 per cent in the previous quarter. In absolute term, the sales were worth about Rs 1,13,807 crore. But, indices but failed to hold onto gains and ended the day with marginal losses, due to profit-booking at higher levels. Meanwhile, Capitals markets regulator SEBI (Securities and Exchange Board of India) has banned 85 entities from capital markets for up to one year for fraudulent trading practices. Finally, the BSE Sensex fell 17.43 points or 0.03% to 58,279.48, while the CNX Nifty was down by 15.70 points or 0.09% to 17,362.10.

The US markets settled mostly lower on Tuesday on lingering concerns about the delta variant's impact on the economic reopening. Goldman Sachs downgraded its economic outlook over the weekend, citing the delta variant and fading fiscal stimulus. Goldman now sees 5.7% annual growth in 2021, below the 6.2% consensus. The firm cut its fourth-quarter GDP outlook to 5.5%, down from 6.5%. Goldman stated the hurdle for strong consumption growth going forward appears much higher: the delta variant is already weighing on Q3 growth, and fading fiscal stimulus and a slower service sector recovery will both be headwinds in the medium term. Boeing shares were lower after private report stated that deliveries for the 787 Dreamliner would likely be further delayed. PPG Industries, a paint maker, warned that sales may fall short this quarter because of logistics issues and higher commodity costs. Shares of PPG Industries ticked nearly 3.4% lower. However, travelers Companies climbed more than 2.5 percent. Walt Disney shares gained about 1.8 percent and Apple surged up 1.4 percent. Netflix gained more than 2.5 percent, and Amazon ended nearly 1 percent up. Shares of medical device manufacturer Tandem Diabetes Care, Inc soared more than 13 percent, buoyed by reports the company is set to enter the S&P MidCap 400 effective from September 20.

Crude oil futures ended lower on Tuesday amid renewed worries about the outlook for energy demand due to continued surge in coronavirus cases in several countries. The drop in prices was also due to Saudi Arabia's decision to slash crude prices for Asia. Further, uncertainty about the pace of global economic recovery following last week's somewhat disappointing US non-farm payrolls data also weighed on oil prices. However, data showing a strong rebound in China's imports and exports capped oil's losses. China's exports increased by 25.6% year-on-year in August, beating street's forecast of 17.1%. In July, exports surged up 17.1%. Imports were up 33.1% annually in August, after a 28.1% increase a month earlier. China's trade surplus stood at $58.34 billion in August, well above the expected level of $51.05 billion. Crude oil futures for October fell $0.94 or 1.4 percent to settle $68.35 barrel on the New York Mercantile Exchange. November Brent crude dropped $0.61 or 0.85% percent to settle at $71.61 a barrel on London's Intercontinental Exchange. 

Extending losses for the second straight session, Indian rupee ended considerably lower against dollar on Tuesday, on account of sustained dollar demand from importers and banks. Traders were worried as India reported 31,222 new cases of Covid-19 and 290 deaths from the disease in 24 hours. Some cautiousness came in as a private report projected a real gross value added (GVA) growth of 7 to 8 per cent year-on-year in the second quarter of current fiscal year versus 20.1 per cent growth in 1Q FY22. On the global front, Sterling dipped for a second consecutive day against a broadly stronger dollar on Tuesday, adding to losses sustained at the start of the week on stuttering economic momentum in Britain. Finally, the rupee ended 73.42, weaker by 32 paise from its previous close of 73.10 on Monday.

The FIIs as per Tuesday's data were net buyer in both equity and debt segment. In equity segment, the gross buying was of Rs 6380.01 crore against gross selling of Rs 5960.07 crore, while in the debt segment, the gross purchase was of Rs 1156.36 crore against gross selling of Rs 930.29 crore. Besides, in the hybrid segment, the gross buying was of Rs 31.82 crore against gross selling of Rs 17.94 crore.

The US markets ended mostly in red on Tuesday as traders returned from the Labor Day holiday, even as gains for some Big Tech companies nudged the Nasdaq composite barely higher. Asian markets are trading mostly lower on Wednesday with Japan revising upward its estimates for second-quarter growth. Indian markets closed flat and snapped a three-day gaining streak as IT, banks, and realty stocks dragged indices down. Today, the markets are likely to make flat-to-positive start amid mixed global cues. Some support will come as the finance ministry said income taxpayers can file applications before the interim board for settlement of pending tax cases at the Income Tax Settlement Commission (ITSC) level by September 30. The Finance Act, 2021, has amended the provisions of the Income Tax Act, 1961, to provide that the ITSC shall cease to operate with effect from February 1, 2021. Additionally, In a major move towards making domestic markets more liquid, capital markets regulator SEBI, on Tuesday introduced T+1 settlement cycle for completion of share transactions on an optional basis. Traders may take note of Food and Consumer Affairs Minister Piyush Goyal's statement that agriculture exports have an important role to play in doubling farmers' income, and stressed the need for boosting India's outward shipments to be among top-5 nations in farm exports. However, traders may be concerned as Fitch Ratings said India continues to lag way behind in COVID vaccination, and the negative outlook on sovereign rating signifies the rising debt-to-GDP ratio. In April 2021, Fitch affirmed India's sovereign rating at BBB- with a negative outlook. It added vaccination is the key to economic recovery across the world. Meanwhile, the commerce ministry's investigation arm DGTR has recommended the imposition of anti-dumping duty on Vitamin C, used by pharmaceutical firms for medicine production, from China to guard domestic manufacturers from cheap imports. Shares of InterGlobe Aviation, SpiceJet and other airlines may also trade choppy as Minister of Civil Aviation Jyotiraditya Scindia is slated to hold a press conference later in the day. Banking stocks will be in limelight as India Ratings and Research (Ind-Ra) maintained a stable outlook on the overall banking sector for the rest of FY22, supported by the continuing systemic support.  Telecom stocks will be in focus with report that the Union Cabinet is likely to consider and discuss a relief package for the sector on Wednesday. There will be some reaction in insurance industry stocks with a private report that after witnessing a double-digit contraction in new business premium (NBP) in July, life insurers are back in the green again, witnessing a marginal year-on-year (YoY) growth of 3 per cent in NBP in August, owing to a strong performance by the private insurers.

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

Nifty Top volumes

• L&T's construction arm has secured significant order for its Water and Effluent Treatment business in India. 
• Infosys has almost completed its buyback programme and its buyback committee will meet on September 8 to consider closure of the buyback programme. 
• Dr. Reddy's Laboratories has launched the prescription drug Minoxidil topical solution USP 2% and 5% for the treatment of female pattern hair loss. 
• Eicher Motors' motorcycle arm -- Royal Enfield has launched the all-new Classic 350 model in Rajasthan market.