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Indian equity markets are likely to make a cautious start on Wednesday, influenced by mixed cues from global markets. Volatility may persist due to heavy FII selling. Additionally, investors will be closely watching upcoming earnings reports and the release of the HSBC Composite PMI Flash data.

Some of the key factors to be watched:

Key infra sectors' growth slows to 0.5%in April: The output of eight key infrastructure sectors slowed down to an eight-month low of 0.5 per cent in April due to contraction in the production of crude oil, refinery products and fertiliser.

Retail inflation for farm and rural workers eases marginally in April: Labour ministry statement said that Retail inflation for farm as well as rural workers eased marginally to 3.48 per cent and 3.53 per cent, respectively, in April this year compared to the pace of price hikes for the two categories at 3.73 per cent and 3.86 per cent recorded in March.

Industry hopeful of RBI rate cut very soon: PHDCCI Secretary General Ranjeet Mehta said that the industry is hopeful of a rate cut by the Reserve Bank very soon and expects India's economic growth at more than 6.5 per cent in the current financial year.

Govt working on amendments to insolvency law: The government is planning to amend the Insolvency and Bankruptcy Code (IBC) to streamline the resolution process. A key change involves Section 31(4), potentially removing the requirement for bidders to secure CCI approval before submitting resolution plans to the Committee of Creditors (CoC). 

Gas Sector's stocks will be in focus: The Central Electricity Authority (CEA) has reduced gas-based power generation capacity to 20.13 gigawatt (GW) at the end of April from 24.53 GW in March.

On the global front: The US markets ended in red on Tuesday, weighed down by rising Treasury yields and growing fiscal concerns. Asian markets are trading mostly in green on Wednesday, despite Wall Street's decline. In Japan, April trade data revealed a deficit of 115.8 billion yen, contrary to expectations of a surplus.

Back home, Indian equity benchmarks extended their losing streak for the third consecutive session and ended lower by over a percent on Tuesday, dragged down by broad-based selling amid reports of increasing COVID-19 cases in Southeast Asian countries like Singapore and Hong Kong. Finally, the BSE Sensex fell 872.98 points or 1.06% to 81,186.44 and the CNX Nifty was down by 261.55 points or 1.05% to 24,683.90.                    

Some of the important factors in trade:

FPIs turn net sellers: The provisional data from the National Stock Exchange showed foreign portfolio investors (FPIs) turned net sellers on Monday, offloading equities worth Rs 526 crore. The FPIs bought Rs 5,746.5 crore on Friday. So far in May, the overseas investors have net bought shares worth Rs 26,103 crore.

India makes progress in making manufacturing sector more attractive to global investors: S&P Global study stated that India has made progress in making its manufacturing sector more attractive to global investors, and ongoing changes in international trade policy would benefit India in the long run.

India, US discuss expediting conclusion of first phase of trade pact: Commerce and Industry Minister Piyush Goyal held discussions with US Commerce Secretary Howard Lutnick in Washington to expedite negotiations on the first phase of the proposed bilateral trade agreement between the two countries.

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