Choppiness continues on Dalal Street in noon deals

Indian equity benchmarks continued to trade choppy in afternoon session, as sentiment remained weak in the absence of any positive trigger amid sustained capital outflows by foreign funds. Depreciation in Indian rupee too dampened sentiments. The rupee was down by 12 paise at 66.72 against the American currency in late-morning deals on sustained bouts of dollar demand from importers amid volatile equities. However, some support came with Nikkei Services Purchasing Managers' Index (PMI) rising to a ten-month high of 53.6 in December, compared to 50.1 last month, marking a sixth month above the 50-level that separates growth from contraction.

Asian markets were trading mostly in red at this point of time, as Beijing continued guiding the yuan lower and a survey pointed to weakness in China’s services sector, while the Japanese yen drew support from risk aversion. Back home, buying in oil and gas sector is lending some support to markets as the Prime Minister Narendra Modi has stressed on taking a 'fresh look' at the petroleum sector during a meeting with global oil and gas experts, to bring in investment, technological upgradation and development of human resource. The broader indices, however, were outperforming benchmarks, while the market breadth on the BSE was positive; there were 1,758 shares on the gaining side against 899 shares on the losing side while 120 shares remain unchanged.

The BSE Sensex is currently trading at 25582.84, up by 2.50 points or 0.01% after trading in a range of 25502.96 and 25632.57. There were 14 stocks advancing against 16 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 0.63%.

The top gaining sectoral indices on the BSE were Energy up by 1.88%, Oil & Gas up by 1.51%, Telecom up by 1.01%, Realty up by 0.43% and Utilities up by 0.32%, while FMCG down by 0.96%, Metal down by 0.19%, Auto down by 0.13%, IT down by 0.01% and Banking down by 0.01% were the top losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 2.75%, Bharti Airtel up by 1.93%, Cipla up by 1.33%, GAIL India up by 1.09% and TCS up by 1.07%. On the flip side, ITC down by 2.06%, ICICI Bank down by 1.32%, Mahindra & Mahindra down by 0.81%, Sun Pharma down by 0.79% and Tata Steel down by 0.78% were the top losers.

Meanwhile, industry chamber in their pre-budget consultation with Finance Minister Arun Jaitley on January 06 will push for simplification of Income Tax laws and calibrated phasing out of exemptions after lowering of corporate tax rate. Confederation of Indian Industry (CII) is likely to demand lowering of corporate tax rate to near 20 per cent, as against the intention of the government to bring it down to 25 per cent from the present 30 per cent in the next four years.

In the 2015-16 budget, Jaitley had announced that corporate tax rate would be brought down gradually to 25 per cent from the present 30 per cent over the next four years and exemptions would be phased out. Accordingly, in November, the revenue department unveiled the draft roadmap for phasing out of exemption and invited public comments on the same. Revenue Secretary Hasmukh Adhia had earlier said that major cause of large-scale litigations is various exemptions and deductions given under the existing income tax law.Further, Assocham is likely to ask for addressing policy gaps in existing provisions and enacting specific provisions to deal with key issues. According to the industry chamber several existing provisions of the Act leave significant questions of policy (both substantive as well as procedural) which remain unaddressed lead to extensive litigation. Assocham has said that addressing such gaps through suitable legislative amendments in the Act will go a long way in minimising litigation and provide certainty to taxpayers

The government has already set up a high-level committee under a former Delhi High Court judge to suggest simplification of Income Tax laws. The committee would submit its preliminary report by January 31, just in time for incorporating suggestions that need legislative approval in the Budget for 2016-17.

The CNX Nifty is currently trading at 7789.10, up by 4.45 points or 0.06% after trading in a range of 7759.20 and 7797.25. There were 26 stocks advancing against 24 stocks declining on the index.

The top gainers on Nifty were Reliance Industries up by 2.72%, Bharti Airtel up by 2.21%, BPCL up by 1.77%, Cipla up by 1.50% and Bank of Baroda up by 1.38%. On the flip side, ITC down by 2.11%, ICICI Bank down by 1.36%, Vedanta down by 0.97%, Tata Steel down by 0.97% and Ambuja Cement down by 0.88% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 declined 182.68 points or 0.99% to 18,191.32, Hang Seng decreased 147.34 points or 0.7% to 21,041.38, Taiwan Weighted shed 84.72 points or 1.05% to 7,990.39 and KOSPI Index was down by 5.1 points or 0.26% to 1,925.43. On the flip side, FTSE Bursa Malaysia KLCI increased 5.12 points or 0.31% to 1,670.82, Jakarta Composite surged 53.94 points or 1.18% to 4,611.77 and Shanghai Composite was up by 67.81 points or 2.06% to 3,355.52.