Benchmarks erase early losses; starts trading in green

Indian equity benchmarks erased losses and climbed into positive terrain in the late morning session on account of buying in frontline blue chip counters. The sentiments got a push with Finance Minister Arun Jaitley’s statement that the government is running against time for the implementation of GST, but added that he would certainly like to give it a try. He said the new GST, once implemented, would have a transformational impact by creating a common market in the country, while also acting as a transfer mechanism that would aid poorer states. Meanwhile, Economic Affairs Secretary Shaktikanta Das has said that implementation of the goods and services tax will bring small and medium enterprises (SMEs) into the national value chain and committed many more reforms. Das, who attended the G20 summit in China earlier this week enlightened with confidence that the kind of reforms which India has undertaken has been very widely appreciated by G20 countries. Traders were seen piling position in Realty, Metal and PSU stocks, while selling was witnessed in IT and TECK sector stocks. In scrip specific development, TCS was trading under pressure after the software major stated that there could be sequential loss of momentum as its clients may hold back discretionary spending in banking, financial services and insurance (BFSI) segment in the US.

On the global front, Asian shares traded mostly in red; with investors awaiting Chinese trade data and a policy meeting by the European Central Bank, where it may announce an extension of its asset buying campaign. Japan's economy grew faster over April-June than initially estimated, the Cabinet Office stated, with upward revisions to capital expenditure and inventories, but the lack of a strong growth driver is seen undermining momentum for the rest of this year. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 8,900 and 28,900 levels respectively. The market breadth on BSE was positive in the ratio of 1401:732, while 115 scrips remained unchanged.

The BSE Sensex is currently trading at 28984.39, up by 58.03 points or 0.20% after trading in a range of 28854.56 and 28988.51. There were 23 stocks advancing against 7 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.07%, while Small cap index was up by 0.74%.

The top gaining sectoral indices on the BSE were Realty up by 1.80%, Metal up by 1.60%, PSU up by 0.86%, Oil & Gas up by 0.79% and Auto up by 0.73%, while IT down by 2.81% and TECK down by 2.13% were the losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 4.06%, Bajaj Auto up by 3.39%, Hero MotoCorp up by 2.39%, ONGC up by 2.26% and Maruti Suzuki up by 1.86%.

On the flip side, TCS down by 5.35%, Infosys down by 2.28%, Wipro down by 1.65%, Tata Motors down by 1.23% and Coal India down by 0.26% were the top losers.

Meanwhile, terming the implementation of Goods and Services Tax (GST) a top priority, Finance Minister Arun Jaitley has expressed his confidence that the tax rates will probably stabilize once the indirect taxation regime is put in place. He further said that implementation of GST from 1st April next year is very stiff target and they are running against time but they want to give a try. He added that the challenges for the government are to put public sector bank on track and continue to operationalise stalled infrastructure projects to further boost economic activity.

Finance Minister said that “We have kept a very stiff target and the reason is that there is a great national aspiration in support of a reform that GST is, and state after state within a period of 20-25 days have kept on ratifying it because they stand to benefit the most.'

Jaitley said the procedural formalities of collecting proceedings of all the states and sending it to the President for ratification is on. Once the assent is granted by President Pranab Mukherjee, the constitution amendment bill will have to be notified. Further he said that after notification and constitution of the GST Council there are obviously some pending issues, which the council will have to resolve. The constitution amendment bill for GST has received Parliament’s nod last month and has been ratified by more than 50% of the states.

The CNX Nifty is currently trading at 8928.95, up by 11.00 points or 0.12% after trading in a range of 8896.00 and 8932.15. There were 34 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Tata Steel up by 4.06%, Bajaj Auto up by 3.52%, Bharti Infratel up by 2.66%, Hero MotoCorp up by 2.50% and ONGC up by 2.35%.

On the flip side, TCS down by 5.14%, Yes Bank down by 2.67%, Tech Mahindra down by 2.50%, HCL Tech down by 2.46% and Infosys down by 2.28% were the top losers.

The Asian markets were trading mostly in red; Nikkei 225 decreased 125.1 points or 0.74% to 16,887.34, KOSPI Index decreased 7.42 points or 0.36% to 2,054.46, Jakarta Composite decreased 6.58 points or 0.12% to 5,374.77, Shanghai Composite decreased 1.73 points or 0.06% to 3,090.20 and FTSE Bursa Malaysia KLCI decreased 0.66 points or 0.04% to 1,688.91.

On the other hand, Taiwan Weighted increased 7.16 points or 0.08% to 9,266.23 and Hang Seng increased 100.86 points or 0.42% to 23,842.67.