Mumbai: Indian equities may continue to remain under pressure on Wednesday amidst slew of factors that are likely to dent investor sentiment.

Ahead of official-level trade talks between India and the US this week in New Delhi, President Donald Trump has again warned India that its high tariff regime is not acceptable to the US. Starting 5 June, India had imposed retaliatory tariffs on 28 US products, including almonds and apples.

Among global markets, Asian shares inched ahead on Wednesday while higher Treasury yields lifted the dollar as markets wondered if the world’s most powerful central banker would confirm or confound expectations for US policy easing this month.

MSCI’s broadest index of Asia-Pacific shares outside Japan advanced 0.2%, after three sessions of losses. South Korea climbed 0.6%, but Japan's Nikkei lagged with a loss of 0.15%.

Shares of Tata Consultancy Services (TCS) are expected to be in focus after it reported revenue for the June quarter that was materially below the Street’s estimates. Revenue stood at $5.49 billion, an increase of merely 1.6% over the seasonally weaker March quarter. Year-on-year growth in revenue fell to 10.6% in constant currency terms in June, from 12.7% in the March quarter.

Shares of InterGlobe Aviation Ltd, which runs India’s largest airline, may also be in focus as feud between the two founders of the company took an ugly turn, with Rakesh Gangwal seeking the regulator’s intervention to curb alleged governance violations by co-founder Rahul Bhatia.

Meanwhile, Federal Reserve Chair Jerome Powell will testify before the US Congress on Wednesday and Thursday and investors have a lot riding on him sounding suitably dovish.

Futures are still fully priced for a 25-basis-point cut at the Fed’s 30-31 July meeting, but have abandoned wagers on a half-point move. They had implied a 25% probability of an aggressive cut before Friday’s upbeat jobs report.

The cooling in US rate fever has seen bonds give back just a little of their huge rally, with yields on two-year treasuries rising to 1.909% from the recent trough of 1.696%. That in turn has helped the dollar bounce on a basket of currencies to 97.537 from a June low of 95.843.

The dollar also firmed to 108.96 yen, while the euro faded to $1.1204 having been as high as $1.1412 just a couple of weeks ago.

The Mexican peso was nursing a few bruises after sliding on Tuesday when the country's moderate Finance Minister Carlos Urzua suddenly resigned, citing "extremism" in economic policy.

The Canadian dollar was on the defensive ahead of a rate meeting by the Bank of Canada in case policy makers tried to slow the currency's recent rally. The dollar’s gains took the shine off gold, which eased 0.3% to $1,393.14 per ounce.

Oil prices were supported by Middle East tensions and OPEC supply cuts. Brent crude futures rose 67 cents to $64.83, while US crude gained 83 cents to $58.66 a barrel.

(Reuters contributed to the story)

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