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Indian markets ended a two-day pullback on Wednesday amid weakness across sectors, as nervousness persisted across global markets. Today, markets are likely to make cautious start amid weak global cues. Traders will be concerned as the Reserve Bank said India witnessed a current account deficit of 1.2 per cent of GDP in 2021-22 against a surplus of 0.9 per cent in FY2020-21 due to a wider trade deficit. There will be some cautiousness as minutes of the central bank’s meeting showed that the RBI Governor Shaktikanta Das has cautioned that continued high inflation is a major concern for the economy, even as economic activities are gaining traction while voting for a 50 basis points hike in key interest rate to check price rise earlier this month. Selling in FIIs is also likely to weight on markets. Foreign institutional investors (FIIs) have net sold Rs 2,920.61 crore worth of shares on June 22. However, some support may come as Prime Minister Narendra Modi said the government expects the Indian economy to grow by 7.5 per cent this year. Modi also said the value of the Indian digital economy will reach $1 trillion by 2025. Meanwhile, an Indian ministerial panel will meet next week to discuss a goods and services tax on cryptocurrency transactions. Aviation industry stocks will be in limelight as the data shared by the Directorate General of Civil Aviation (DGCA) showed that domestic air passenger traffic jumped to 1.2 crore in May 2022, marking a surge of 11 percent as compared to the preceding month. There will be some reaction in Telecom stocks as in a big relief for telecom companies, the Department of Telecommunications (DoT) has scrapped the 3 per cent floor rate on spectrum usage charge (SUC). Edible oil industry stocks will be in focus as Food Secretary Sudhanshu Pandey said oil prices in the retail market have started easing with softening of international rates and the government's timely intervention.

The US markets ended lower on Wednesday as energy shares weighed and investors digested Fed Chair Jerome Powell's comments on the US central bank's aim to bring down inflation. Asian markets are trading mostly in red on Thursday as investors continued to monitor recession concerns.

Back home, Indian benchmark indices halted a two-day rally and ended the Wednesday’s session on negative note, with Sensex and Nifty breaching their crucial psychological 51,900 and 15,450 levels, respectively. Markets traded in red since the beginning, on the back of heavy selling pressure coupled with weak Asian cues. The market participants remained worried with RBI data showed that operating profit growth of listed private companies decelerated across broad sectors in the January-March quarter of 2021-22, on the back of rise in expenditure. Operating profit of manufacturing companies decelerated sharply to 7 per cent in the fourth quarter of last fiscal as against 70 per cent in the corresponding quarter of the preceding fiscal. Unabated foreign fund outflows also played spoilsport for the markets. As per exchange data, foreign institutional investors (FIIs) remained net sellers in the capital market, as they sold shares worth Rs 2,701.21 crore on Tuesday. Further, in the late afternoon deals, the markets extended their fall to close near day’s low point, as sentiments on the street weakened further after the CBDT said that the Income Tax department has detected unaccounted income of over Rs 100 crore after it recently raided a diversified business group engaged in the export of handicraft and real estate among others. Some pessimism also came after private report stated that oil prices rose $2 per barrel on June 21, 2022 on high summer fuel demand while supplies remain tight because of sanctions on Russian oil after its invasion of Ukraine. The street overlooked Minister for commerce and industry and textiles -- Piyush Goyal expressed hope that the free trade agreement (FTA) between India and the United Kingdom will be concluded by Diwali. Total trade between India and the UK stood at $16 billion in FY22 (Apr-Feb). Finally, the BSE Sensex fell 709.54 points or 1.35% to 51,822.53 and the CNX Nifty was down by 225.50 points or 1.44% to 15,413.30.

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