The benchmark indices ended with deep cuts on Wednesday, amid weak global cues. The prospect that the US Federal Reserve and other central banks will be forced to hike interest rates more aggressively has reignited fears of a global recession. The Nifty closed below 15,450 mark after hitting a high of 15,565.40 in early trade. Selling was wide spread with metal, media, and realty stocks declining the most.

The barometer index, the S&P BSE Sensex, down 709.54 points or 1.35% to 51,822.53. The Nifty 50 index declined 225.50 points or 1.44% to 15,413.30.

Tata Steel (down 5.24%), Wipro (down 3.29%), Reliance Industries (down 3.07%), Indusind Bank (down 2.67%) and HCL Technologies (down 2.61%) were major drags.

The broader market surged. The S&P BSE Mid-Cap index slipped 1.53% while the S&P BSE Small-Cap index shed 1.11%.

The market breadth was weak. On the BSE, 1,250 shares rose and 2,081 shares fell. A total of 109 shares were unchanged.

Politics:

Political crisis has deepened in Maharashtra. Senior Shiv Sena leader and state cabinet minister Eknath Shinde has rebelled against Uddhav Thackeray leadership. Shinde has claimed the support of 40 Shiv Sena MLAs out of a total of 55 and took some of them to BJP-ruled Gujarat. They were shifted to Guwahati in Assam from Surat on Wednesday morning. To circumvent the anti-defection law, Shinde will need two-thirds of the 55 Shiv Sena MLAs which comes to 37, on his side.

Numbers to Track:

The yield on India's 10-year benchmark federal paper fell to 7.396 as compared with 7.482 at close in the previous trading session.

In the foreign exchange market, the rupee declined against the dollar. The partially convertible rupee was hovering at 78.39, compared with its close of 78.1375 during the previous trading session.

MCX Gold futures for 5 August 2022 settlement declined 0.02% to Rs 50,752.

The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, rose 0.09% to 104.53.

In the commodities market, Brent crude for August 2022 settlement fell $4.76, or 4.15% at $109.89 a barrel.

Global Markets:

The Dow Jones futures were down 397 points, indicating a negative opening in the US stock market today.

Shares in Europe and Asia tumbled on Wednesday, amid fears over surging inflation and slowing economic growth.

In Europe, U.K. inflation hit a new 40-year high of 9.1% year-on-year in May as soaring food and energy prices continue to deepen the country's cost-of-living crisis.

The Bank of Japan, after maintaining its ultra-low interest rates last week, released the minutes from its April monetary policy meeting on Wednesday. Many members expressed the view that underlying inflation, measured by the CPI excluding such factors as energy, remained relatively low, the minutes said. Most members of BOJ policy board expect short-term and long-term interest rates to remain at their present levels or lower, the minutes added.

In the US market overnight, the Dow surged 641 points, or 2.15%. The S&P 500 added 2.45%, turning in its best day since May 4. The jump comes after the benchmark index slumped 5.79% last week in its worst weekly performance since March 2020.

Fed Chair Jerome Powell will testify before Congress Wednesday and Thursday. His appearance comes after a recent rate hike by three-quarters of a percentage point, the central bank's biggest increase since 1994.

Stocks in Spotlight:

Zomato rose 2.12%. The board of the restaurant aggregator and food delivery company is scheduled to meet on 24 June 2022 to consider a potential acquisition transaction by the company. The consideration of the potential acquisition may be discharged through preferential issue of the company's equity shares, Zomato said in a statement on Tuesday, 21 June 2022.

Hero MotoCorp gained 0.82%. The company launched Euro-5 compliant variants of its three globally popular products in Turkiye. The range of Hero MotoCorp products in the Turkiye include the Xpulse 200 4V motorcycle and Dash 110, Dash 125 scooters.

Astral declined 1.85% after the company said it has subscribed to Optionally Convertible Debentures (OCDs) of Rs 194 crore issued and allotted by Gem Paints on Tuesday, 21 June 2022. Astral has appointed majority directors on the board of Gem Paints and Esha Paints and control is established in terms of the aforesaid debenture subscription agreement. Accordingly, Gem Paints and Esha Paints have become subsidiary and step down subsidiary of the company respectively in terms the applicable provisions of the Companies Act 2013.

Jain Irrigation Systems surged 10.27%. The International Irrigation Business (IIB) of Jain Irrigation will be merged with Singapore's Rivulis and create a global irrigation and climate leader - being 2nd largest in the world with about $750 million in revenues.

Cyient shed 1.23%. The technology solutions company on Wednesday announced the launch of an AI-powered framework for automated system and software testing (CyFAST), to accelerate end-to-end test automation. The platform enables end-to-end test automation across web, mobile, desktop, and embedded application and hardware devices, providing a comprehensive environment for managing testing projects, the company said.

Delhivery slipped 1.98%. The company announced the plans to expand its infrastructure in Bhiwandi (Greater Mumbai) and Bangalore. As per the regulatory filing, Delhivery is collaborating with Welspun on a 7 Lakh sq ft mega-gateway in Greater Mumbai and with GMR for a 1 Million+ sq ft facility in Bangalore. The Bangalore facility also includes a warehouse for multi-channel order fulfillment for Delhivery's customers. These fully-automated large integrated trucking terminals will be operational by 2023 and will increase Delhivery's processing capacity to meet the customer demand from the South and West, the company said.

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