Sensex, Nifty erase losses in late morning session

Indian equity benchmarks erased losses and started trading in green in late morning session on account of buying in front line blue chip counters. The strength seen in local benchmark equity was despite muted trend seen in other Asian markets even as European markets yesterday rose to their highest in more than a year. The rupee opened higher against dollar on account of selling of American currency by bank and exporters. Banks stocks rebounded after yesterday’s weakness due to lending rate cut. The upside was however capped as traders took note of India’s core sector growth which slowed to 4.9 percent in November from 6.6 percent in the previous month as crude oil and natural gas production declined. Though, it dodged the demonetization effect on the back of better show in coal, steel and electricity generation. The GST Council will meet Commerce and Industry minister Nirmala Sitharaman and representatives of IT, Telecom, Heavy Industry, Road Transport, Banking and Insurance sectors today to assess the implementation hurdles under the new goods and services tax (GST) regime. Representatives of Civil Aviation and Railway sectors will make a presentation at the two-day meeting of the GST Council. Traders were seen piling position in Consumer Durables, Oil & Gas and PSU stocks, while selling was witnessed in IT, TECK and Auto sector stocks. Shares of logistics companies such as GATI, Snowman Logistics, Gateway Distriparks, Transport Corporation of India, Patel Integrated Logistics, Sical Logistics, Allcargo Logistics and VRL Logistics were trading firm ahead of the GST Council meet scheduled for today. In scrip specific development, Infosys was trading in red after IT major’s chief executive Vishal Sikka cautioned in a letter to his employees that the tidal wave of automation and technology-fuelled transformation could make the traditional information technology services obsolete.

On the global front, Asian shares were trading mostly in green, extending gains after European shares surged to their highest in a year. Markets were buoyed by signs of solid factory growth in China and Europe, giving the global manufacturing sector a solid boost heading into the New Year. A private business survey showed China’s factory activity picked up more than expected in December as demand accelerated, with output reaching a near six-year high. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 8,150 and 26,500 levels respectively. The market breadth on BSE was positive in the ratio of 1582:611, while 89 scrips remained unchanged.

The BSE Sensex is currently trading at 26597.87, up by 2.42 points or 0.01% after trading in a range of 26488.37 and 26638.91. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.46%, while Small cap index was up by 0.81%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 2.50%, Oil & Gas up by 1.47%, PSU up by 1.28%, Power up by 0.89% and Bankex up by 0.71%, while IT down by 0.69%, TECK down by 0.68%, Auto down by 0.16% and Metal down by 0.03% were the losing indices on BSE.

The top gainers on the Sensex were Power Grid up by 2.32%, Axis Bank up by 1.67%, ITC up by 0.95%, ICICI Bank up by 0.79% and SBI up by 0.68%.

On the flip side, Infosys down by 1.55%, Bharti Airtel down by 1.27%, Hero MotoCorp down by 1.01%, Wipro down by 0.77% and Lupin down by 0.72% were the top losers.

Meanwhile, Union Finance Minister Arun Jaitley has expressed hope that Goods and Services Tax (GST) will be implemented in 2017 and a digitised economy will be future of India. He also said that the last year was a very successful year for India as the country continued to remain the fastest economy in the world. He also expressed optimism that Indian economy will continue to be one of the fastest growing economies in 2017 as well.

Jaitley in his New Year message to the nation also said that the long-awaited GST, once implemented, would turn Asia's third-largest economy into a single market for the first time, broaden the tax base and make life simpler for businesses that now pay a host of federal and state levies. Citing that the activity of demonetisation was completed in a peaceful manner and well supported by citizens, Jaitley said that a large amount of money, including black money, has come back into the banking system and it will increase banks' ability to lend more. He added that they are now keeping the inflation under control and consequently they have seen interest rates coming down.

The finance minister also asserted that the process of 'remonetisation' has progressed extremely well and it is certain that in the days to come it will be completed. Jaitley's statement came a day after Prime Minister Modi announced major tax rebates for farmers, small traders, senior citizens and women. He also urged the nation's banking system to work for the poor and the marginalised and complimented the people for joining and supporting the government's cleansing drive against corruption and black money.

The CNX Nifty is currently trading at 8188.30, up by 8.80 points or 0.11% after trading in a range of 8148.60 and 8196.70. There were 27 stocks advancing against 24 stocks declining on the index.

The top gainers on Nifty were Power Grid up by 2.15%, Yes Bank up by 2.01%, Axis Bank up by 1.73%, BPCL up by 1.61% and BHEL up by 1.55%.

On the flip side, Infosys down by 1.48%, Hero MotoCorp down by 1.14%, Bharti Airtel down by 1.11%, Bharti Infratel down by 1.05% and Idea Cellular down by 1.00% were the top losers.

The Asian markets were trading mostly in green; Taiwan Weighted increased 11.1 points or 0.12% to 9,264.60, KOSPI Index increased 13.26 points or 0.65% to 2,039.42, Shanghai Composite increased 22.37 points or 0.72% to 3,126.00 and Hang Seng increased 169.41 points or 0.77% to 22,169.97.

On the other hand, Jakarta Composite decreased 32.41 points or 0.61% to 5,264.30 and FTSE Bursa Malaysia KLCI decreased 9.76 points or 0.59% to 1,631.97.

Japan’s stock exchange was closed on account of an extended New Year holiday.