Benchmarks trade in fine fettle on firm global cues

Supported by firm global cues, Indian equity benchmarks have made a positive start and are trading in fine fettle in early deals on Wednesday. Some support came with the industry body, Associated Chambers of Commerce and Industry of India’s (Assocham) statement to drive economic growth, the focus should now be on effective implementation of the steps announced by Prime Minister Narendra Modi in his address to the nation on New Year's Eve, as they are extremely positive for the Indian economy. Appreciation in Indian rupee too aided sentiments. Rupee was trading 12 paise higher at 68.22 during early-morning trade.

On the global front, Asian markets were trading mostly in green at this point of time, led by the Japanese market after yen weakened against dollar on confidence in the US economy. The US markets made a modestly positive start of the New Year, though the major indices pulled off the day’s high but managed decent gains on heels of some upbeat economic data. Back home, gains remained capped, as the prospects of a rollout of the Goods & Services Tax (GST) regime from April 1, 2017 appeared to recede further after representatives of States expressed concern about the timeline at a meeting of the GST Council. Foreign portfolio investors (FPIs) sold shares worth a net Rs 500.49 crore, while Domestic institutional investors (DIIs) bought shares worth a net Rs 562.27 crore on January 3.

The BSE Sensex is currently trading at 26719.03, up by 75.79 points or 0.28% after trading in a range of 26632.95 and 26720.80. There were 24 stocks advancing against 6 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.54%, while Small cap index was up by 0.79%.

The top gaining sectoral indices on the BSE were Metal up by 1.11%, Auto up by 0.85%, Power up by 0.85%, Realty up by 0.72% and Capital Goods was up by 0.71%, while FMCG down by 0.28% and Oil & Gas was down by 0.22% were the only losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 2.15%, Tata Steel up by 1.23%, ONGC up by 1.17%, GAIL India up by 1.16% and NTPC was up by 1.09%. On the flip side, Reliance Industries down by 0.88%, ITC down by 0.55%, Cipla down by 0.46%, Bharti Airtel down by 0.35% and HDFC Bank was down by 0.23% were the top losers.

Meanwhile, the industry body, Associated Chambers of Commerce and Industry of India (Assocham) has said that to drive economic growth, the focus should now be on effective implementation of the steps announced by Prime Minister Narendra Modi in his address to the nation on New Year's Eve, as they are extremely positive for the Indian economy. Prime Minister had announced major tax rebates for the poor, 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.

Assocham President, Sunil Kanoria said that the initiatives like 60-day interest waiver for farmers who have taken loans from district co-operative banks and primary societies together with additional fund of Rs 20,000 crore given to NABARD to give loans to farmers would help in alleviating pains of farmers and rural class. He also said that schemes like interest subsidy on loans for low cost housing together with impetus to affordable housing will provide much needed help to vulnerable sections of society and revive consumer confidence amid largest, but poorest socio-economic group. He further said that the push towards low cost housing is also good news for retail portfolio of banks and non-banking financial companies (NBFCs) that have been struggling to boost their business amid economic slowdown. He also said that the credit guarantee for SME and MSME has been increased to Rs 2 crore and this will provide support to these sectors.

Kanoria added that the government should also complement these actions with substantial reduction in both individual and corporate tax rates, more so as private sector investments are yet to kick-start and lower tax rates will certainly push private investments and drive economic growth. On the banking sector, he said that banks have started reducing interest rates, considering that post-demonetisation there has been a substantial surge in deposits, and further rate cuts will only revive consumption demand and reinvigorate the investment cycle.

The CNX Nifty is currently trading at 8214.70, up by 22.45 points or 0.27% after trading in a range of 8190.85 and 8217.85. There were 40 stocks advancing against 11 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 2.04%, Bharti Infratel up by 1.96%, Tata Motors - DVR up by 1.51%, Hindalco up by 1.38% and ONGC was up by 1.30%. On the flip side, Kotak Mahindra Bank down by 0.84%, Reliance Industries down by 0.84%, BPCL down by 0.80%, Bharti Airtel down by 0.77% and ITC was down by 0.62% were the top losers.

Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI rose 6.62 points or 0.4% to 1,642.15, Shanghai Composite gained 12.37 points or 0.39% to 3,148.29, Taiwan Weighted increased 22.56 points or 0.24% to 9,295.44 and Nikkei 225 was up by 433.9 points or 2.27% to 19,548.27.

On the flip side, Hang Seng decreased 20.1 points or 0.09% to 22,130.30, Jakarta Composite slipped 6.52 points or 0.12% to 5,269.45 and KOSPI Index was down by 0.13 points or 0.01% to 2,043.84.