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Indian markets staged a smart recovery and reversed early losses to end modestly higher on Wednesday led by strong gains in metal shares. Today, markets are likely to get negative start amid weak cues from global markets along with rise in crude oil prices overnight. Investors likely to remain on sidelines ahead of the Reserve Bank of India's bi-monthly monetary policy decision, slated to be announced later in the day for more directional clues. The RBI's rate setting Monetary Policy Committee (MPC) is widely expected to take a hawkish stance as flaring vegetable prices upend the inflation math of the economy. Also, there will be some cautiousness with a private report that the rate of price rise for the consumer basket likely breached the central bank's upper tolerance level of 6 per cent in July. There will be some volatility in the markets ahead of weekly F&O expiry later in the day. However, some respite may come as foreign institutional investors (FII) made buying in the cash segment of Indian equities for the first time in the last 10 consecutive sessions, purchasing shares worth Rs 644.11 crore on August 9, provisional data from the National Stock Exchange (NSE) showed. Some support may come later in day as Securities and Exchange Board of India’s (SEBI) annual report for the financial year 2022-23 revealed that over 400 new foreign portfolio investors (FPIs) joined the Indian markets in the last financial year. According to the data, the number of FPIs operating in India increased to 11,081 from 10,608 in FY 22. Coal industry stocks will be in focus with a private report that India's total coal imports fell 1.82 per cent to 68.30 million tonne in April-June period of ongoing financial year. The import was at 69.57 MT in the same period a year ago. Meanwhile, the Indian government will sell an additional 50 lakh tonnes of wheat and 25 lakh tonnes of rice under Open Market Sale Scheme (OMSS) to bring down prices of the two essential commodities. As on August 7, in one year, wheat prices have gone up by 6.77 percent in the retail market and 7.37 percent in the wholesale market. Similarly, rice prices in the retail market have gone up by 10.63 percent and 11.12 percent in the wholesale market. In primary market, TVS Supply Chain Solutions’ Rs 880 crore IPO to open for subscription today, in the price band of Rs 187-Rs 197 per share.

The US markets ended lower on Wednesday as investors awaited key inflation readings that could provide clues to the Fed's monetary policy path. Asian markets are trading mixed on Thursday as investors braced for July consumer price index data out from the US.

Back home, Indian equity benchmarks closed higher on Wednesday, helped by fag-end buying in index majors JSW Steel, Tata Motors and Mahindra & Mahindra amid a positive start in European markets. Key gauges opened flat and slipped into the red as the day progressed as traders were anxious ahead of two major events -- RBI’s monetary policy and the US inflation data -- due to be announced on Thursday. Traders were also concerned with a private report indicating that India's retail inflation likely accelerated to 6.40% in July on surging food prices, breaching the upper end of the Reserve Bank of India's 2%-6% tolerance band for the first time in five months. Besides, persistent foreign fund outflows weighed down on the sentiments. Provisional data from the National Stock Exchange (NSE) showed foreign institutional investors (FII) offloaded shares worth Rs 711.34 crore on August 8. However, last-hour buying helped markets to erase all the losses and end higher. Traders got support as the World Trade Organization (WTO) said that two separate dispute settlement panels have stated that India and the US have mutually resolved disputes with regard to certain measures on steel and aluminium products, and additional duties on certain products from the US. Some support also came with Sanjeev Sanyal, Member of the Economic Advisory Council to the Prime Minister, stating that the country should be confident enough to deconstruct the rest of the world on its own terms as a rising economic power, creating global norms and benchmarks in various fields. He said India should no longer be bound by benchmarks that are decided by third parties, and in which the country has no role in framing. Traders also took a note of Finance minister Nirmala Sitharaman’s statement that the 28 per cent GST on full face value of supplies in casinos, race courses and online gaming will result in higher revenues. Finally, the BSE Sensex rose 149.31 points or 0.23% to 65,995.81 and the CNX Nifty was up by 61.70 points or 0.32% to 19,632.55.

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