Indian stock markets, which recently hit record highs, ended flat after a volatile trading session on Tuesday. Today, a cautious opening is anticipated due to foreign fund outflows. According to data from NSE, Foreign Institutional Investors (FIIs) sold Indian equities worth Rs 2,784.14 crore. A surge in crude oil prices, driven by monetary stimulus in China and concerns over escalating tensions in the Middle East, is likely to dampen domestic market sentiment.

Global rating agency S&P has expressed concerns, stating that India's private sector will need to play a larger role in driving investment for the nation's growth, as fiscal constraints may limit government spending. However, global market trends may offer some support. Moody’s Analytics has revised its projection for India's economic growth in 2024 to 7.1%, up from 6.8%, while keeping the growth rate at 6.5% for 2025.

In regulatory news, SEBI has proposed simplifying the onboarding process for FPIs by introducing a shorter version of the Common Application Form (CAF). Meanwhile, IT hardware companies will be under focus as the government extends the import management system for laptops and similar products until December 31. Additionally, S&P Global Ratings predicts loan growth for Indian financial companies will slow to 18% in FY25, down from 20% in FY24, due to the cumulative impact of RBI's policies.

In the primary market, KRN Heat Exchanger and Refrigeration is set to launch its IPO today, aiming to raise Rs 341.95 crore through a fresh issue of 15.5 million shares.

On the global front, US markets closed higher on Tuesday despite weak consumer confidence data, buoyed by a rally in mining stocks after China announced a stimulus package. Asian markets were mostly in the green on Wednesday, continuing the rally. Investors are also keeping an eye on Korea's consumer confidence data for September.

Back in India, Tuesday’s volatile trading saw equity benchmarks closing flat ahead of the F&O monthly expiry. Early gains, supported by ICRA's report on potential business opportunities for EPC players worth Rs 2 lakh crore, were erased in the afternoon amid concerns over rising tensions between Israel and Hezbollah, and fluctuating oil prices. However, the markets managed to recover briefly thanks to foreign fund inflows, with FIIs buying Indian equities worth Rs 404.42 crore on Monday. Despite optimism about India's growth trajectory, losses in FMCG, telecom, and realty stocks caused the indices to close flat. The BSE Sensex slipped by 14.57 points to close at 84,914.04, while the CNX Nifty gained 1.35 points, ending at 25,940.40.