Benchmarks trim gains; trade continues in green

After getting a gap-up start, Indian equities trimmed gains but continue to trade in green in noon deals on hopes that the crucial goods and services tax (GST) bill will be passed in the winter sessions of Parliament. The GST bill has been passed in the Lok Sabha, but has been blocked in Rajya Sabha, where the Modi government lacks a majority. However, weakness in rupee weighed on the sentiments, as the Indian currency slipped to fresh two years low, on persistent bouts of month-end dollar demand from importers and banks. 

On the global front, Asian markets traded mostly lower after Chinese markets saw their biggest drop since August 25, hit by fresh regulatory crackdown on leverage activities and weak industrial profit data. The economic data released overnight did not provide any aid either and investors remained clueless about the long term direction of the markets. European stocks are set to follow Asia lower on Friday in the wake of feeble data from China and Japan and rising tensions between Russia and Turkey.

Back on street, stocks from Banking, Capital Goods and Metal counters were supporting the markets’ uptrend, while those from Consumer Durables, Oil & Gas and FMCG counters were adding to the underlying cautious undertone. In scrip specific development, shares of RPG Life Sciences have soared on reports that the company is charting out a plan to enter the skin care segment as a part of its strategy to move towards customer facing businesses. Furthermore, Welspun Corp has rallied after the company won an order for supply of at 216 K MTs line pipes for an onshore project in Americas.

The market breadth on BSE was negative, out of 2576 stocks traded, 1183 stocks advanced, while 1187 stocks declined on the BSE. 

The BSE Sensex is currently trading at 26024.70, up by 66.07 points or 0.25% after trading in a range of 25937.32 and 26125.63. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.20%, while Small cap index up by 0.05%.

The top gaining sectoral indices on the BSE were Bankex up by 1.18%, Capital Goods up by 1.07%, Metal up by 0.89%, Auto up by 0.29% and IT up by 0.27%, while Consumer Durables down by 0.97%, Oil & Gas down by 0.71% and FMCG down by 0.50% were the top losing indices on BSE.

The top gainers on the Sensex were Hindalco up by 3.06%, Vedanta up by 2.21%, Tata Steel up by 1.69%, Larsen & Toubro up by 1.65% and ICICI Bank up by 1.57%. On the flip side, GAIL India down by 1.32%, Lupin down by 1.31%, Reliance Industries down by 1.01%, Bajaj Auto down by 0.83% and ITC down by 0.61% were the top losers.

Meanwhile, in a positive move, Reserve Bank of India (RBI) has relaxed norms for aircraft and helicopter imports. In its notification RBI has said that the banks could allow advance remittances, without bank guarantee or an unconditional, irrevocable standby letter of credit up to $50 million, in the case of import of aircrafts/ helicopters/ other aviation related purchases once the company has approval from aviation regulator Director General of Civil Aviation (DGCA). The relaxation comes at a time when the Ministry is working on a new aviation policy that seeks to provide various incentives for the sector.

In the latest notification, RBI has done away with the earlier requirement whereby Civil Aviation Ministry's nod was compulsory for advance remittances. These norms would be applicable on companies operating Scheduled or Non-Scheduled Air Transport Services, including Air Taxi Services. Earlier, advance remittance was allowed by banks only when the importing entity had requisite approvals from Civil Aviation Ministry, DGCA and other agencies.

Meanwhile, on evidence of import of goods, RBI also notified that with the establishment of Free Trade Warehousing Zones/SEZ Unit warehouses, imported goods can be stored therein, for re-export/re-selling purposes for which Customs Authorities issue Ex-Bond Bill of Entry. It further said that the banks are advised to consider the Bill of Entry issued by Customs Authorities named as Ex-Bond Bill of Entry or by any other similar nomenclature, as evidence for physical import of goods. Further, in cases where goods have been imported through couriers, the Courier Bill of Entry, as declared by the courier companies to the Customs Authorities, may also be considered as evidence of import of goods.

The CNX Nifty is currently trading at 7906.30, up by 22.50 points or 0.29% after trading in a range of 7879.45 and 7938.90. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 3.01%, Bank of Baroda up by 3%, PNB up by 2.29%, Vedanta up by 2.27% and ICICI Bank up by 1.80%. On the flip side, Idea Cellular down by 1.97%, BPCL down by 1.44%, GAIL India down by 1.31%, Lupin down by 1.24% and Reliance Industries down by 1.19% were the top losers.

Asian markets were trading mostly in red; Hang Seng was down by 1.74%, Taiwan Weighted down by 1.02%, Shanghai Composite down by 4.56%, Nikkei 225 down by 0.3%, Jakarta Composite down by 0.35% and KOSPI Index was down by 0.08%. On the flip side, FTSE Bursa Malaysia KLCI was up by 0.01%.