Benchmarks continue to trade in red in early noon session

Indian equity benchmarks continue to trade in red in early noon session, due to profit booking in frontline line blue-chip stocks. Investors’ sentiments were dented on reports that foreign portfolio investors (FPIs) sold shares worth a net Rs 1,745.73 crore on December 4, 2015 as per provisional data released by the stock exchanges. However, investors were getting encouragement on the prospects of goods and services tax (GST) reform brightening as a panel headed by chief economic adviser Arvind Subramanian backed a lower rate and simpler structure that the opposition Congress party had demanded. The government-appointed panel suggested a standard GST rate of 17-18 percent. It also backed scrapping a proposed 1 per cent additional levy by states on the cross-border transport of goods. Traders were seen piling position in Realty, Bankex, Consumer Durables, Capital Goods and IT stocks, while selling was witnessed in FMCG, PSU, Metal, Auto and Oil & Gas sector stocks.

On the global front, Asian markets were trading mostly in green, after a healthy U.S. jobs report that sent the S&P 500 to its biggest gain since early September. Back home, the broader markets were performing better than the larger peers. The market breadth on BSE was positive, out of 2491 stocks traded, 1415 stocks advanced, while 936 stocks declined on the BSE. 

In scrip specific development, share of Lanco Infratech was trading higher over 6.32% after the company commenced power supply to Haryana discoms from its domestic coal based 300 MW Unit 2 of Lanco Amarkantak Power (LAPL), Chhattisgarh, a step down subsidiary of LITL. Sun Pharmaceutical Industries was trading higher after the company’s subsidiary received final approval from the US Food and Drug Administration (FDA) for its Abbreviated New Drug Application (ANDA) for generic version of Gleevec, Imatinib Mesylate tablets 100mg and 400mg.

The BSE Sensex is currently trading at 25589.22, down by 48.89 points or 0.19% after trading in a range of 25584.98 and 25785.53. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.02%, while Small cap index was up by 0.38%.

The top gaining sectoral indices on the BSE were Realty up by 0.44%, Bankex up by 0.35%, Consumer Durables up by 0.32%, Capital Goods up by 0.21% and IT up by 0.14%, while FMCG down by 1.72%, PSU down by 0.64%, Metal down by 0.62%, Auto down by 0.14% and Oil & Gas down by 0.11% were the losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 3.02%, Tata Steel up by 1.29%, HDFC up by 1.01%, HDFC Bank up by 0.96% and Hindustan Unilever up by 0.80%. On the flip side, ITC down by 4.41%, Coal India down by 2.13%, NTPC down by 1.87%, ONGC down by 1.76% and Reliance Industries down by 0.90% were the top losers.

Meanwhile, apex industry body, The Associated Chambers of Commerce of India (ASSOCHAM) has welcomed the report of Chief Economic Advisor (CEA) Arvind Subramanian- led panel recommending standard GST rate of 18 percent and lower rate of 12 percent on specified goods stating that this rate structure is quite appropriate and will be anti-inflationary for indigenous goods, though the cost of services will go up including some essential services like banking, telecom and information technology (IT).

Further, ASSOCHAM said that the removal of one per cent additional tax is a welcome step as it will remove the cascading effect on cost of indigenous production by four to six per cent as goods move four to six times during entire value chain and said that the higher rate should only be applicable to sin goods. ASSOCHAM fully supports the CEA`s view that rates can`t be put in the Constitution Amendment Bill to make the rates inflexible, however the chamber feels that rates should be stable and predictable to attract investments.

A key government committee headed by Arvind Subramanian on goods and services tax (GST) has suggested a standard GST rate of 17-18 percent and dropping of the one per cent additional tax on inter-state sales. It recommended 12 percent for 'low rate goods' and 40 percent for demerit goods. For precious metal, it recommended a range of 2-6 percent. Also, the panel recommended early inclusion of alcohol and petroleum products in GST, stating that bringing alcohol and real estate within the scope of the GST would further the government's objectives of improving governance and reducing black money generation without compromising on states' fiscal autonomy.

The CNX Nifty is currently trading at 7781.35, down by 0.55 points or 0.01% after trading in a range of 7776.00 and 7825.40. There were 32 stocks advancing against 18 stocks declining on the index.

The top gainers on Nifty were Sun Pharma up by 3.06%, Asian Paints up by 2.89%, Grasim Industries up by 1.56%, Tata Steel up by 1.44% and Ambuja Cement up by 1.28%. On the flip side, ITC down by 4.46%, Cairn India down by 2.44%, Coal India down by 2.27%, NTPC down by 1.65% and ONGC down by 1.61% were the top losers.

Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 6.48 points or 0.39% to 1,674.35, Jakarta Composite increased 38.08 points or 0.84% to 4,546.54, Hang Seng increased 51.12 points or 0.23% to 22,287.01, Taiwan Weighted increased 55.67 points or 0.66% to 8,454.27 and Nikkei 225 increased 233.19 points or 1.2% to 19,737.67, while Shanghai Composite decreased 5.2 points or 0.15% to 3,519.79 and KOSPI Index decreased 3.39 points or 0.17% to 1,971.01.