Markets wipe off gains to trade slightly in red

Erasing all their early gains, Indian benchmarks have entered into red territory in the late afternoon session, as trader shrugged off passage of GST Bill. The run up in the stock prices of companies benefiting from GST was pretty much factored in by the markets and traders booked profit in such companies to continue for a while until more clarity emerges on the Bill. Cautions prevail in the market as trader remained reluctant to make any significant move ahead of Reserve Bank of India (RBI) meet on August 9. 

On global front, European stocks climbed on Thursday as a rise in the shares of major financial and industrial stocks such as Aviva and Siemens boosted the region's equity markets.

Back home, in scrip specific development, Hawkin Cookers jumped after it reported 94.86 per cent rise in net profit at Rs 9.86 crore for the quarter ended June 30, 2016 against Rs 5.06 crore in the corresponding quarter a year ago.

The BSE Sensex is currently trading at 27670.62, down by 26.89 points or 0.10% after trading in a range of 27633.11 and 27921.91. There were 14 stocks advancing against 16 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.03%, while Small cap index was up by 0.16%.

The gaining sectoral indices on the BSE were Auto up by 1.27%, Realty up by 0.85%, Metal up by 0.74% and Power up by 0.51%, while Consumer Durables down by 1.14%, Bankex down by 0.73%, Oil & Gas down by 0.66%, IT down by 0.43% and TECK down by 0.36% were the losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 3.93%, Tata Steel up by 3.08%, Power Grid Corpn. up by 1.42%, Hero MotoCorp up by 1.36% and Sun Pharma Inds. up by 1.22%. On the flip side, Asian Paints down by 1.85%, ICICI Bank down by 1.71%, Lupin down by 1.26%, SBI down by 1.10% and Coal India down by 1.01% were the top losers.

Meanwhile, setting the stage for India’s biggest ever spectrum sale, the Union Cabinet has approved a spectrum usage charge (SUC) of 3 percent of adjusted gross revenue (AGR), excluding revenues from wire-line services. Now Department of Telecommunications (DoT) can issue the Notice Inviting Applications marking the beginning of the auction process. Traditionally, the auctions begin within 45-50 days of the notice being issued.

The Cabinet has also cleared the proposal on using the weighted average method to compute the charge in addition to introducing proposal for a 3 per cent floor rate for the weighted average calculation, which was approved by the inter-ministerial Telecom Commission on July 25. The weighted average of SUC rates across all spectrum assigned to an operator in all access spectrum bands, including broadband wireless access (BWA) spectrum obtained in the 2010 auction, shall be applied for charging SUC, subject to minimum 3 per cent of AGR, and excluding revenues from wire-line services. However, the uniform SUC rate has been a highly contentious issue with the industry due to differences in the fee for the 2300 MHz band (1 per cent) and other bands.

The Cabinet, on June 22, had cleared the proposal for auction in various bands, but wanted more clarifications on the issue of SUC therefore it has asked Telecom Regulatory Authority of India (TRAI) and the Department of Telecom (DoT) to have a fresh look. And finally the Telecom Commission on July 25 recommended 3 percent annual usage charge for the spectrum to be sold in the upcoming auction while fixing the same as the minimum rate even for existing airwaves with all operators.

The auctions, scheduled for September, will see spectrum auctioned in all the major bands, including 700MHz, 800MHz, 900MHz, 1800MHz, 2100MHz, 2300MHz and 2500MHz. This time there will be a total of 2,142 MHz put up for auction in these bands. Besides, the auction is expected to generate over Rs 5.60 lakh crore for the Centre and allow operators to accumulate more spectrums.

The CNX Nifty is currently trading at 8525.05, down by 19.80 points or 0.23% after trading in a range of 8519.50 and 8601.40. There were 22 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 3.84%, Tata Steel up by 2.93%, Tata Motors - DVR up by 2.54%, Hero MotoCorp up by 1.55% and Bank of Baroda up by 1.48%. On the flip side, Asian Paints down by 2.03%, BPCL down by 1.95%, Zee Entertainment down by 1.71%, ICICI Bank down by 1.69% and Indusind Bank down by 1.60% were the top losers.

The Asian markets were trading in green; Shanghai Composite increased 3.97 points or 0.13% to 2,982.43, KOSPI Index surged 5.24 points or 0.26% to 2,000.03, FTSE Bursa Malaysia KLCI climbed 6.37 points or 0.39% to 1,654.87, Jakarta Composite jumped 22.63 points or 0.42% to 5,374.50, Taiwan Weighted rose 23 points or 0.26% to 9,024.71, Hang Seng was moveup 93.11 points or 0.43% to 21,832.23, Nikkei 225 increased 171.78 points or 1.07% to 16,254.89

The European markets were trading mostly in green; France’s CAC increased 14.01 points or 0.32% to 4,335.09, Germany’s DAX increased 66.4 points or 0.65% to 10,236.61. On flip side,UK’s FTSE 100 decreased 9.42 points or 0.14% to 6,624.98