Benchmarks gyrate around neutral line in late morning session

Indian equity benchmarks continued their cautious trade in the late morning session, gyrating around neutral line after both the inflation gauges CPI and WPI showed uptrend due to rise in food inflation amid increased speculation that the US will raise interest rates. Some support crept in on report that Indirect tax collection rose by about 30.8% during April-June to Rs 1,99,970 crore, from Rs 1,52,740 crore collected in the year-ago period. Traders were seen piling position in Metal, Auto and PSU stocks, while selling was witnessed in IT, TECK and Capital Goods sector stocks. In scrip specific development, Tree House Education and Zee Learn were trading firm on account of revised merger ratio. As per the new merger scheme, shareholders of Tree House will get shares in Zee Learn in ratio of 1:1. Piramal Enterprises was trading firm after its wholly owned US subsidiary entered into an agreement to acquire 100% stake in Ash Stevens Inc, a US based contract development and manufacturing organization. On the other hand, Just Dial was trading under pressure following the local search firm’s disappointing quarterly numbers. The company reported a net profit of Rs 38.9 crore on sales of Rs 176.29 crore in the June quarter.

On the global front, Asian markets were trading mostly in red, stepping back from a one-year high after the influential New York Federal Reserve Bank president stated that Fed could raise interest rates as soon as September, prompting investors to pause after rallies in recent weeks. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 8,600 and 28,000 levels respectively. The market breadth on BSE was positive in the ratio of 1296:794, while 119 scrips remained unchanged.

The BSE Sensex is currently trading at 28071.90, up by 7.29 points or 0.03% after trading in a range of 28024.36 and 28136.10. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.34%, while Small cap index was up by 0.57%.

The gaining sectoral indices on the BSE were Metal up by 1.51%, Auto up by 1.02%, PSU up by 0.61%, Realty up by 0.52% and Oil & Gas up by 0.14%, while IT down by 0.84%, TECK down by 0.62%, Capital Goods down by 0.27%, Power down by 0.16% and Bankex down by 0.08% were the losing indices on BSE.

The top gainers on the Sensex were Hero MotoCorp up by 3.26%, Coal India up by 2.35%, Tata Steel up by 2.00%, Bajaj Auto up by 1.90% and Axis Bank up by 1.54%.

On the flip side, TCS down by 1.39%, ICICI Bank down by 1.09%, Asian Paints down by 1.05%, Infosys down by 1.02% and Larsen & Toubro down by 0.73% were the top losers.

Meanwhile, buoyed by good tax collection, the tax department is hopeful of meeting the revenue collection target for FY 2016-17, as the Center has collected Rs 1,99,970 crore from indirect taxes during April-June, up by 30.8 percent compared to Rs 1,52,740 crore a year earlier. The collection up to June indicates that 25.7% of the Annual Budget target of indirect taxes has been achieved in the first three months of the fiscal.

In July, indirect taxes collections grew 23.4 per cent to Rs 68,341 crore as compared to Rs 55,388 crore in the same month last year. Central excise grew 53.8 per cent to Rs 31,782 crore from Rs 20,658 crore, service tax collections increased 25 per cent to Rs 19,600 crore from Rs 15,685 crore. For the period April-July Central excise collections shot up 50.8 per cent, service tax collections grew 25.8 per cent and customs collections recorded 7.9 per cent growth. The Government has pegged indirect tax collection target at Rs 7.78 lakh crore in the current fiscal, up 9.7 percent from Rs 7.09 lakh crore actual collections previous fiscal.

Central Board of Excise and Customs chairman Najib Shah has said that it is very early to say how the year will be. Still, they are hopeful of achieving the target given to them by the government for the entire fiscal. He added that the government has crossed the revised estimate to collect Rs 7.09 lakh crore as per provisional estimates.

The CNX Nifty is currently trading at 8638.80, down by 3.75 points or 0.04% after trading in a range of 8626.55 and 8657.60. There were 23 stocks advancing against 28 stocks declining on the index.

The top gainers on Nifty were Hero MotoCorp up by 3.28%, Coal India up by 2.50%, Tata Steel up by 2.04%, Bajaj Auto up by 1.79% and Axis Bank up by 1.56%.

On the flip side, Ultratech Cement down by 1.57%, TCS down by 1.47%, ACC down by 1.14%, Infosys down by 1.13% and Ambuja Cement down by 1.06% were the top losers.

The Asian markets were trading mostly in red; Taiwan Weighted decreased 17.9 points or 0.2% to 9,092.46, KOSPI Index decreased 10.11 points or 0.49% to 2,037.65, Shanghai Composite decreased 5.95 points or 0.19% to 3,104.09 and FTSE Bursa Malaysia KLCI decreased 5.26 points or 0.31% to 1,694.63.

On the other hand, Hang Seng increased 52.61 points or 0.23% to 22,963.45 and Nikkei 225 increased 106.52 points or 0.64% to 16,703.03. Jakarta Stock Exchange was closed on account of ‘Independence Day’ holiday.