Benchmark equity indices - Sensex and Nifty - ended Thursday below the previous close, largely on account of massive selloff in global markets. Global investors remained cautious after the US Fed's gloomy economic outlook. The BSE Sensex ended 394.40 points, or 1.02 per cent, lower at 38,220.39, while the broader NSE Nifty slipped 96.20 points, or 0.84 per cent, to 11,312.20.
The top losers included HDFC, Axis Bank, Bharti Airtel, M&M, Reliance Industries, ICICI Bank, IndusInd Bank and Titan. On the other hand, NTPC, ONGC, PowerGrid and Tata Steel were the gainers.
"The global markets came under pressure after the US Federal Reserve raised concerns over uncertainty of US economic recovery. The US VIX jumped by 5.7 per cent, while India VIX jumped by 4.2 per cent to 20.8 levels. The domestic investors on the other hand, got worried over the prolonged economic slowdown as the coronavirus pandemic grips rural areas of the country. Even RBI has turned cautious over the recent surge in consumer inflation. On the positive side, the CCEA announced approval of one time relaxation to PFC and REC for extending loans to DISCOMs above limits under the UDAY scheme. Thus a lot of action was witnessed in the power stocks," said Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services.
Here are 5 things to know before Friday's opening bell:
RBI MPC minutes
RBI Governor Shaktikanta Das has emphasised that although there is headroom for further monetary policy action, the "arsenal" has to be kept dry and used judiciously for promoting growth which has been hit hard by the COVID-19 pandemic, according to the MPC minutes released on Thursday. Das also said that the recent surge in retail inflation is negatively impacting the efforts by the central bank to revive economic growth.
US Fed's minutes
The US Fed's minutes, released on Wednesday, showed again that policymakers are finding it difficult to forecast the path of the economy, which will depend greatly on what happens with the coronavirus. Vinod Nair, Head of Research at Geojit Financial Services said, "Indian indices along with global markets traded in the red today, on the back of US Fed Reserve's grim July meeting minutes. The Fed Reserve casts doubts on the nascent recovery of the labour market seen in the previous months and its sustainability."
Markit Manufacturing PMI Flash and Existing Home Sales data is scheduled to be released on August 21.
AGR case hearing
The Supreme Court on Thursday expressed concerns that nearly the entire Adjusted Gross Revenue (AGR) dues pending against the telcos facing insolvency proceedings will be wiped out in the Insolvency and Bankruptcy Code (IBC) proceedings. A bench of Justices Arun Mishra, S Abdul Nazeer and MR Shah also said that a new buyer of spectrum, under the insolvency process, will extinguish any pending demand against the spectrum in question. The hearing will resume on Friday.
Coronavirus cases
India recorded the biggest ever spike of 69,652 new COVID-19 cases, taking the total to 2,841,400. The country's death toll has surged to 54,017. The US and Brazil have been left behind by India in the seven-day average of daily new coronavirus cases.
Technical insight
"The benchmark index has been gradually inching higher amid positive yet volatile global markets. And, we do not see this scenario changing any time soon. At the same time, noticeable traction in the broader space is offering ample opportunities to the traders. We reiterate our view to focus more on the selection of stocks and trade management citing overnight risk," said Ajit Mishra, VP - Research, Religare Broking.
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