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Indian markets extended losses to the third day in a row on Tuesday, as renewed concerns about the Omicron variant of COVID-19 spooked investors globally. Today, markets are likely to make a sluggish opening amid mixed global cues. Traders will be concerned as the Asian Development Bank for the second time in three months has scaled down India’s growth estimate for the fiscal year ending March 2022 due to supply chain issue of industries. There will be some cautiousness as the Centre for Monitoring Indian Economy (CMIE) stated that the urban unemployment rate spiked to the double-digit rate for the first time in 17 weeks, to be 10.09% for the week-ended December 12, pushing the country’s overall jobless rate to a nine-week high of 8.53%. The rural jobless rate was also at a nine-week high of 7.42% during the week. However, some support may come as the government data showed that India's merchandise exports jumped 27.16 per cent to $30.04 billion in November on the back of good performance by sectors like petroleum products, engineering goods and electronic items. The exports stood at $23.62 billion in November 2020. Some support may also come as Union Minister of Commerce and Industry Piyush Goyal said India is becoming the global hub for innovation with the third-largest startup ecosystem. Traders may take note of Finance Minister Nirmala Sitharaman said the Centre earned nearly Rs 8.02 lakh crore from taxes on petrol and diesel during the last three fiscal years, of which more than Rs 3.71 lakh crore was collected in FY21 alone. Meanwhile, the finance ministry has turned down a key suggestion of the NK Singh-led Fiscal Responsibility and Budget Management (FRBM) Committee to set up an independent Fiscal Council consisting of experts to assess and advise on the government’s spending and fiscal policies. NBFCs stocks will be in focus as the RBI introduced a prompt corrective action (PCA) framework for large non-banking financial companies (NBFCs), putting restrictions on para-banks whenever vital financial metrics dip below the prescribed threshold. The PCA framework for NBFCs comes into effect on October 1 next year on the basis of their financial position on or after March 31. Tata Group stocks will be in limelight with report that the Tata Group is in discussions with some major international companies, including those from Taiwan, for its foray into the semiconductor chip business. Besides, HP Adhesives, one of the leading manufacturers of consumer adhesives and sealants, Rs 126 crore IPO will open for subscription today. The price band for the issue is Rs 262 – 274 per share.

The US markets ended lower on Tuesday after data showed producer prices increased more than expected in November, solidifying expectations the Federal Reserve this week will announce a faster wind-down of asset purchases. Asian markets are trading mixed on Wednesday as investors awaited the outcome of the US central bank's policy review.

Back home, in a volatile session, Indian equity benchmarks fell for the third day in a row on Tuesday, tracking weakness across global markets amid renewed concerns about the Omicron variant of COVID-19. Benchmarks started session on a negative note and stayed in red for whole day, as traders remained cautious with, as the state health department said Maharashtra on Monday reported two new patients infected with the new Omicron variant of SARS-CoV-2. Sentiments remained down-beat with a private report showed that foreign direct investment (FDI) into India in the July-September quarter of 2021-22 fell a sharp 42% on year at $13.5 billion from $23.4 billion a year ago. Some pessimism also came as preliminary data from the statistics ministry showed India's inflation accelerated again in November, driven by steep increases in food and fuel prices. The consumer price index rose 4.91 percent year-on-year following a 4.48 percent increase in the previous month. Street had forecast 5.10 percent inflation. A year ago, inflation was 6.93 percent. However, indices erased most of their early losses in afternoon session, as traders found some solace with estimates by Export-import Bank of India showed that India’s merchandise exports are expected to grow by 51 per cent to about $303.98 billion in nine months ending December 2021 over the same period in 2020. Some support also came with NITI Aayog CEO Amitabh Kant’s statement that the government will continue to push for greater reforms across sectors. Kant stated ‘India is determined to carry out reforms. We need more and more reforms and the government will push for greater levels of reforms across sectors and make things easy and simple.’ However, markets failed to hold recovery and ended lower, as some pessimism remained among traders with data showing that India’s inflation based on wholesale price index (WPI) jumped to 14.23% in the month of November as against 12.54% in October. The annual rate of inflation is 14.23% (Provisional) for the month of November 2021 as compared to 2.29% in November 2020. Finally, the BSE Sensex fell 166.33 points or 0.29% to 58,117.09 and the CNX Nifty was down by 43.35 points or 0.25% to 17,324.90

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