Benchmarks continue firm trade in late afternoon session

Indian equity benchmarks continued their firm trade in the late afternoon session on account of buying in frontline blue chip counters taking cues from global counterparts. Investors shrugged off report by Moody’s Investors Service which highlighted that efforts to consolidate 27 public sector banks into 8-10 large lenders create risks that could offset potential long-term benefits in the current weak economic environment. Traders were seen piling position in FMCG, Oil & Gas and Metal stocks while selling was witnessed in IT, TECK and Consumer Durables sector stocks. In scrip specific development, Panacea Biotech was locked at upper circuit limit after the pharma major introduced indigenously developed high quality antidiabetic drug, Tenepan (Teneligliptin), for treatment of type 2 diabetes mellitus. Bharti Infratel was trading in green after the company announced that its proposed buyback of equity shares would commence on July 12, 2016 and close on July 25, 2016. The company proposed buyback of 4.70 crore shares at Rs 425 per share. Gujarat Gas was trading firm after the company announced that the Petroleum and Natural Gas Regulatory Board (PNGRB) granted permission to develop city gas distribution network (CGD) in Ahmedabad, Gujarat.

On the global front, the Asian markets were trading mostly in green while the European markets were trading on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 8,100 and 26,500 levels respectively. The market breadth on BSE was positive in the ratio of 1593:856 while 173 scrips remained unchanged.

The BSE Sensex is currently trading at 26535.60, up by 132.64 points or 0.50% after trading in a range of 26378.46 and 26583.33. 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 0.44%, while Small cap index up by 0.79%.

The gaining sectoral indices on the BSE were FMCG up by 1.62%, Oil & Gas up by 0.86%, Metal up by 0.85%, Capital Goods up by 0.71% and PSU up by 0.67% while, IT down by 0.64%, TECK down by 0.22% and Consumer Durables down by 0.09% were the losing indices on BSE.

The top gainers on the Sensex were Lupin up by 3.71%, ITC up by 2.51%, Hindustan Unilever up by 2.44%, Bharti Airtel up by 1.77% and Cipla up by 1.23%.

On the flip side, Tata Motors down by 1.65%, TCS down by 0.94%, Wipro down by 0.93%, NTPC down by 0.87% and Hero MotoCorp down by 0.64% were the top losers.

Meanwhile, the Central Board of Direct Taxes (CBDT) has issued Circular clarifying that the Tax Collected at Source (TCS) will not be applicable when cash component of the payment for goods and services is not exceeding Rs 2 lakh, even when the total payment is more than this amount.

CBDT in its latest circular stated that, “TCS will not be levied if the cash receipt does not exceed Rs 2 lakh even if the sale consideration exceeds Rs 2 lakh.” The circular further clarified that, TCS is required to be collected at source on cash component of the sales consideration and not on the whole of sales consideration.

The clarification has came in regard to the applicability of the provisions to levy TCS, as announced in the Budget, where the sale consideration received is partly in cash and partly in cheque. Presently, Income Tax Department is charging 1% TCS on cash purchase of bullion in excess of Rs 2 lakh and jewellery in excess of Rs 5 lakh since July 1, 2012 and there has been no change in that position

The CNX Nifty is currently trading at 8131.10, up by 36.40 points or 0.45% after trading in a range of 8086.85 and 8146.35. There were 32 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Bharti Infratel up by 3.89%, Idea Cellular up by 3.69%, Lupin up by 3.64%, Hindustan Unilever up by 2.61% and ITC up by 2.54%.

On the flip side, Tata Motors - DVR down by 2.64%, HCL Tech. down by 2.34%, Tata Motors down by 1.70%, NTPC down by 0.94% and Wipro down by 0.85% were the top losers.

The Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 5.28 points or 0.32% to 1,634.80, KOSPI Index increased 9.37 points or 0.49% to 1,936.22, Nikkei 225 increased 13.93 points or 0.09% to 15,323.14, Shanghai Composite increased 16.85 points or 0.58% to 2,912.56, Jakarta Composite increased 46.25 points or 0.96% to 4,882.30 and Taiwan Weighted increased 46.64 points or 0.55% to 8,505.51.

On the other hand, Hang Seng decreased 54.84 points or 0.27% to 20,172.46.

The European markets were trading in green; UK’s FTSE 100 increased 130.87 points or 2.19% to 6,113.07, Germany’s DAX increased 216.38 points or 2.33% to 9,485.04 and France’s CAC increased 109.39 points or 2.75% to 4,094.11.