Benchmarks continue firm trade; Realty, Oil & Gas lead

Indian equity markets continued their firm trade in the late afternoon session on account of buying in frontline blue chip counters. The sentiments were on upbeat mood on report that the government is likely to go for a fresh round of consultations on Goods and Service Tax (GST) with the opposition parties after the Bihar elections. Investors took note of Reserve Bank Governor Raghuram Rajan statement who underlined the need to make taxation more transparent so that the Indian economy is able to attract stable inflow of foreign capital for strong growth. Traders were seen piling position in Realty, Oil & Gas and TECK stocks, while selling was witnessed in Capital Goods, Metal and Power sector stocks. In the scrip specific development, Amtek Auto was trading firm on reports that the auto component maker is close to reaching a deal with JP Morgan Asset Management Company, which holds its non-convertible debentures worth Rs 200 crore.

On the global front, the Asian markets were trading mostly in green, while the European markets were trading mostly on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading below the psychological 8,250 and 27,300 levels respectively. The market breadth on BSE was positive in the ratio of 1479:1071 while 159 scrips remained unchanged.

The BSE Sensex is currently trading at 27349.82, up by 135.22 points or 0.50% after trading in a range of 27246.79 and 27386.19. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.40%, while Small cap index up by 0.60%.

The gaining sectoral indices on the BSE were Realty up by 1.16%, Oil & Gas up by 0.90%, TECK up by 0.86%, FMCG up by 0.78%, IT up by 0.61%, while Capital Goods down by 0.64%, Metal down by 0.46%, Power down by 0.40%, PSU down by 0.27% and Auto down by 0.25% were the losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 4.77%, Bharti Airtel up by 3.77%, Sun Pharma up by 1.78%, Infosys up by 1.43% and Hindustan Unilever up by 1.06%.

On the flip side, ONGC down by 2.29%, Tata Steel down by 1.90%, Tata Motors down by 1.62%, Larsen & Toubro down by 1.13% and ICICI Bank down by 0.97% were the top losers.

Meanwhile, in order to attract more retail investors into the stock markets, the Department of Disinvestment (DoD) has suggested tax incentives for small investors. The department has made a formal proposal for tax incentives to the Department of Economic Affairs (DEA) in the Finance Ministry.

Further, the DoD wants a broad based retail market to be created to get good value for the government stake sale planned in several PSUs. The DoD has been long trying to attract more retail investors into the equity market so that they can own a pie in the government companies as and when PSU stake sales happen. According to the DoD, a tax incentive will attract retail investors to equities of both public and private companies. Furthermore, it added that encouraging retail investors will ensure flow of savings into domestic capital markets which would improve its depth.

Currently, the government reserves 20 per cent of the issue size for retail investors, who are allowed to invest up to Rs 2 lakh in the Offer for Sale (OFS). Also a 5 per cent discount is offered to them over the bid price. However, the quota reserved for retail investors has not been fully subscribed in some of the big-ticket stake sales like Indian Oil Corp (IOC) and Coal India Ltd (CIL).

The CNX Nifty is currently trading at 8262.85, up by 24.70 points or 0.30% after trading in a range of 8239.20 and 8279.75. There were 25 stocks advancing against 25 stocks declining on the index.

The top gainers on Nifty were Reliance Industries up by 4.70%, Bharti Airtel up by 3.82%, Sun Pharma up by 1.73%, Infosys up by 1.33% and Hindustan Unilever up by 1.06%.

On the flip side, ONGC down by 2.37%, Adani Ports &Special down by 2.15%, Tata Steel down by 2.06%, Tata Motors down by 1.86% and Bank of Baroda down by 1.52% were the top losers.

The Asian markets were trading mostly in green; KOSPI Index increased 0.01 points or 0% to 2,030.27, Hang Seng increased 8.24 points or 0.04% to 23,075.61, Taiwan Weighted increased 26.55 points or 0.31% to 8,631.50 and Jakarta Composite increased 44.49 points or 0.98% to 4,566.38.

On the other hand, Nikkei 225 decreased 160.57 points or 0.88% to 18,131.23, Shanghai Composite decreased 4.65 points or 0.14% to 3,386.70 and FTSE Bursa Malaysia KLCI decreased 0.88 points or 0.05% to 1,715.94.

The European markets were trading mostly in green; France’s CAC increased 13.63 points or 0.29% to 4,716.42, Germany’s DAX increased 66.07 points or 0.65% to 10,170.50 while UK’s FTSE 100 decreased 11.75 points or 0.18% to 6,366.29.