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Indian markets snapped a three-day gaining streak on Tuesday amid tepid global mood. Today, the start of session is likely to be negative amid lackluster global cues. Investors will closely monitor the manufacturing PMI data for May, which will be released later in the day. Traders will be concerned as the government data showed that India’s economic growth hit a four-quarter low of 4.1%, partly driven by base effect. The growth was 20.1%, 8.4%, and 5.4%, in the first, second and third quarters, respectively. Some cautiousness may be come as foreign Institutional Investors (FII) were once again net sellers of domestic stocks. FIIs pulled out Rs 1,003 crore from Dalal Street. However, some support may come later in the day as chief economic adviser (CEA) V Anantha Nageswaran said the Indian economy is better placed than other countries and the fear of stagflation is exaggerated. Traders may be taking encouragement as production growth of eight infrastructure sectors rose to a six-month high of 8.4 per cent in April on the back of better performance by coal, refinery products and electricity segments. Traders may take note of India Meteorological Department Director General Mrutyunjay Mohapatra’s statement that the average rainfall this monsoon season is expected to be 103% of the long period average. India can expect more rainfall this monsoon season than predicted earlier. In April, the IMD had said the country would receive normal rainfall -- 99% of the long period average. Besides, Fiscal deficit for 2021-22 improved to 6.71 per cent of the GDP over the revised budget estimate of 6.9 per cent mainly on account of higher tax realisation. Sugar stocks will be in focus as the data released by cooperative body NFCSFL showed that sugar production in India, the world's largest producer and second-largest exporter, rose 15 per cent to a record 35.24 million tonne till May 30 in the ongoing 2021-22 marketing year on higher output in Maharashtra and Karnataka. There will be some reaction in edible oil industry stocks as the government said India has slashed the base import prices of crude and refined palm oil, while raising the price of crude soyoil. Textile industry stocks will be in limelight as the government said India recorded its highest-ever textiles and apparel exports in the financial year 2021-22 at $44.4 billion.

The US markets ended lower on Tuesday as volatile oil markets kept soaring inflation in focus and investors reacted to hawkish comments from a Federal Reserve official. Asian markets are trading mixed on Wednesday with investors watching for market reaction to the release of a private survey on Chinese factory activity for May.

Back home, Indian equity benchmarks snapped their 3-day winning streak to end lower in a highly volatile session on Tuesday, as investors are eyeing GDP numbers for the fourth quarter of the previous fiscal year (2021-22) to be out later in the day. As per the expectations, India's economy likely slowed in the fourth quarter and is expected to grow between 3.5-5.5 percent. Markets made gap-down opening, as traders were anxious with domestic ratings agency India Ratings stating that the GST has not helped states achieve the key objective of boosting their tax revenue. The rating agency said that the data does not point to any benefits to the states in the last five years since the implementation of GST (Goods and Services Tax). However, key indices managed to trim most of their losses in afternoon deals, taking support from secretary at the department of economic affairs, Ajay Seth’s statement that India's inflation should ease in the coming months following steps taken by the Union government and as global prices coming off in May will have a salutary impact. Though, markets failed to hold on to recovery mode and fell sharply in late afternoon deals, as some pessimism remained among traders with private report stated that soaring prices and the subsequent hit to consumer spending and investments are likely to further dampen India's economy, as the central bank faces a finely balanced struggle to tame inflation via rate hikes without hurting economic growth. Some concern also came amid a private report stating that India’s economy probably grew slower than previously estimated last year, with virus curbs in the final quarter seen as a drag on activity while the war in Europe has added a new inflation hurdle to recovery. Meanwhile, Department of Financial Services (DFS) secretary Sanjay Malhotra has said that advance action is underway for privatisation of two public sector banks (PSBs) in pursuance of the announcement made by finance minister Nirmala Sitharaman. Finally, the BSE Sensex fell 359.33 points or 0.64% to 55,566.41 and the CNX Nifty was down by 76.85 points or 0.46% to 16,584.55.

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