Benchmarks pare losses to trade flat; Sensex regains 28,000 mark

Indian equity benchmarks have pared most of their losses to trade near neutral line with Sensex and Nifty recapturing their crucial levels of 28,000 and 8650 respectively. However, investors remained on sidelines ahead of the ongoing government meet on the goods and services tax (GST) for clarity on new rates. The crucial GST Council meeting, comprising federal and state finance ministers, will decide the main tax rate and those for different sectors. In scrip specific development, Tata Motors was trading in red after the company increased prices of its passenger vehicles by up to Rs 12,000 across models to offset rising input costs. 

On the global front, European stocks were trading in red on Wednesday after a strong session the previous day. While key readings on Chinese GDP, retail sales and fixed-asset investment growth matched estimates, mixed earnings updates served to induce some caution ahead of ECB meeting.

The BSE Sensex is currently trading at 28048.57, down by 2.31 points or 0.01% after trading in a range of 27926.17 and 28131.07. 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 0.09%, while Small cap index was up by 0.66%.

The gaining sectoral indices on the BSE were Power up by 1.43%, Oil & Gas up by 0.81%, PSU up by 0.73%, Consumer Durables up by 0.49%, TECK up by 0.40%, while FMCG down by 0.69%, Realty down by 0.69%, Bankex down by 0.43%, Auto down by 0.17%, Capital Goods down by 0.10% were the losing indices on BSE.

The top gainers on the Sensex were Wipro up by 2.84%, Lupin up by 2.31%, GAIL India up by 1.99%, Power Grid up by 1.98% and Sun Pharma up by 1.58%. On the flip side, ICICI Bank down by 2.00%, ITC down by 1.85%, Hero MotoCorp down by 0.95%, SBI down by 0.76% and HDFC down by 0.74% were the top losers.

Meanwhile, the Cellular Operators Association of India (COAI) has urged the telecom regulator TRAI to postpone review of interconnects usage charges (IUC) till March 2017. The industry body has said that the regulator has initiated various other consultations which depending upon their final outcomes 'may have a significant direct impact on cost structures, changes in technology and other market dynamics’.

TRAI had fixed October 17 as deadline for receiving industry comments on the contentious consultation paper on interconnection usage charges or IUC, which is paid by one telecom operator to another for connecting phone calls. COAI reportedly said that actual network-related costs incurred by telecom operators should be used to compute the interconnect charges, thereby batting for an increase in mobile termination charge.

Telecom operators including Bharti Airtel, Vodafone and Idea Cellular have sought to defer the review till March 2017. COAI in its latest submission to TRAI said that 'It is therefore critical that the IUC review should not be held at this stage and be deferred by some months, that is, after end March 2017. By such time there will be more clarity on several issues’’. Trai had extended the date for receiving comments on the paper twice.

COAI, in its response pointed out that 'all its member operators support and recommend that mobile termination charge should be determined on the cost based principle, only Reliance Jio has a divergent view that 'Bill and Keep' approach should be adopted for determining the MTC. The mobile termination charge is currently pegged at 14 paise per minute and a cost-based model would imply an increase in termination charges. The cost-based model includes network operating costs, overhead costs, spectrum costs and capital costs.

The CNX Nifty is currently trading at 8679.55, up by 1.65 points or 0.02% after trading in a range of 8636.70 and 8698.75. There were 31 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were BHEL up by 3.96%, Tata Power up by 2.98%, Wipro up by 2.74%, Idea Cellular up by 2.47% and Lupin up by 2.39%. On the flip side, ICICI Bank down by 2.03%, ITC down by 1.91%, HDFC down by 0.96%, Zee Entertainment down by 0.93% and Hero MotoCorp down by 0.89% were the top losers.

Asian market were trading mostly in green; KOSPI Index increased 0.51 points or 0.02% to 2,040.94, Shanghai Composite rose 0.84 points or 0.03% to 3,084.72, Nikkei 225 climbed 35.3 points or 0.21% to 16,998.91 and Taiwan Weighted jumped 61.41 points or 0.67% to 9,283.99. On the other hand, Hang Seng decreased 89.42 points or 0.38% to 23,304.97, Jakarta Composite decreased 26.11 points or 0.48% to 5,403.94 and FTSE Bursa Malaysia KLCI decreased 0.29 points or 0.02% to 1,667.28.

European markets were trading in red; Germany’s DAX was down by 21.56 points or 0.2% to 10,609.99, UK’s FTSE 100 decreased 16.89 points or 0.24% to 6,983.17 and France’s CAC dropped 3.42 points or 0.08% to 4,505.49.