Markets trade flat with negative bias in range-bound session of trade

In the extremely range-bound session of trade, Indian equity benchmarks alternating between positive and negative territory, were now trading flat with bit of negative bias as investors shifted focus to fundamentally sound stocks in the broader market. The sentiments were distrustful after rupee lost against the dollar, on fresh demand for the American currency from banks and importers. Traders seem to be still reeling under pressure of RBI’s decision of keeping its key policy rates unchanged. However, losses remained capped with Finance Minister Arun Jaitley’s statement that the government was committed to going ahead with reforms measures to take India back to original potential of 8 per cent economic growth. Some support also came in from reports that foreign portfolio investors (FPIs) bought shares worth a net Rs 107 crore on December 02, 2014.

The broader markets outperformed frontline indices with the BSE Midcap and Smallcap indices rising more than a percent. On the sectoral front, stocks from Power, Capital Goods and Auto counters were supporting the markets’ uptrend, while those from FMCG and information technology (IT) counters were adding to the underlying cautious undertone. In scrip specific development, Shares of Patel Airtemp have surged after the company has bagged export orders worth Rs 56 crore. Furthermore, shares of Pfizer have gained on completing merger with pharmaceutical company, Wyeth.

On global front, Asian markets gained for a second straight day on Wednesday following another slate of impressive US data that helped the dollar march towards the 120-yen mark for the first time in seven years. Furthermore, US stocks rose as energy stocks led the S&P 500 and Dow, while Biogen's rally on news about an experimental treatment for Alzheimer's disease topped gains at the Nasdaq.

Back home, the market breadth on BSE was positive, out of 2306 stocks traded, 1581 stocks advanced, while 644 stocks declined on the BSE.

The BSE Sensex is currently trading at 28426.65 down by 17.36 points or 0.06% after trading in a range of 28504.65 and 28370.73. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.32%, while Small cap index up by 1.29%.

The gaining sectoral indices on the BSE were Power up by 1.40%, Capital Goods up by 1.15%, Auto up by 0.99%, Infrastructure up by 0.97% and Consumer Durables up by 0.85% while, FMCG down by 0.86%, IT down by 0.17% and TECK down by 0.10% were the losing indices on BSE.

The top gainers on the Sensex were BHEL up by 3.54%, NTPC up by 1.39%, Mahindra & Mahindra up by 1.13%, Axis Bank up by 1.04% and Tata Motors up by 1.02%. On the flip side, Dr. Reddys Lab down by 2.02%, ITC down by 1.79%, HDFC down by 1.44%, Infosys down by 0.66% and HDFC Bank down by 0.46% were the top losers.

Meanwhile, the Goods and Services Tax (GST) rollout, which has missed several deadlines because of lack of consensus among states over certain crucial issues on the new tax regime, may see some development with the Finance Ministry proposing to compensate states for three years for losses they may incur on account of switching to a nationwide GST regime, as against a demand for a five-year compensation by the state governments.

The present government in its bid to roll out GST from April 1, 2016 countrywide, wants to introduce the bill in the current session of the Parliament. GST Bill would be taken up by the Cabinet after Empowered Committee (of state Finance Minister) meeting on December 12.

Union Finance Minister Arun Jaitley will meet state finance ministers on December 11 to build consensus on issues related to inclusion of petroleum products, entry tax and compensation funds. States have been demanding that petroleum, alcohol and tobacco should be kept out of the purview of GST.

A sub-committee on GST has suggested that the revenue neutral rate of GST be pegged at about 27 per cent and had also suggested that states GST be kept at 13.91 per cent and Central GST at 12.77 per cent, though the states are yet to decide on it.

The CNX Nifty is currently trading at 8523.85 down by 0.85 points or 0.01% after trading in a range of 8540.60 and 8508.35. There were 33 stocks advancing against 16 declining on the index.

The top gainers on Nifty were Jindal Steel & Power up by 4.15%, BHEL up by 3.76%, Asian Paints up by 2.50%, Indusind Bank up by 2.45% and IDFC up by 1.34%. On the flip side, Dr. Reddys Lab down by 2.04%, ITC down by 2.00%, HDFC down by 1.56%, Infosys down by 0.65% and HDFC Bank down by 0.57% were the top losers.

The Asian markets were mostly in green, Straits Times was up by 0.32%, KOSPI Index gained 0.31%, Shanghai Composite was higher by 0.47%, Taiwan Weighted moved up by 1.55% and Nikkei 225 surged by 0.50%. On the other hand, Hang Seng lost 0.42%, FTSE Bursa Malaysia KLCI was down by 0.84% and Jakarta Composite was lower by 0.22%.