Benchmarks pare some gains; Nifty holding on to 8,950 level

Indian benchmark indices pared some gains but continued their firm trade in the noon session on Monday, as investors lacked conviction to pile up fresh positions. Sentiments remained upbeat with the GST council moving a step closer towards implementing the goods and services tax (GST) from 1 July, approving two crucial supporting legislations of central GST law (CGST) and the integrated GST (IGST) law for this ambitious tax reform. It will again meet on 16 March to clear the state GST law (SGST) and the union territory GST law (UTGST). Once all the bills are passed by the council, the Union government will collectively take the bills to the Union cabinet for its approval. Some support also came with the report that foreign investments in the services sector increased 77.6 percent to $ 7.55 billion in the first nine months of the current fiscal, helped by government steps to improve ease of doing business. However, investors remained cautious on rising geopolitical tensions in East Asia, as North Korea fired four ballistic missiles early in the day, while a spat between China and South Korea over missile defence deepened. Meanwhile, Information technology (IT) stocks came under pressure on Monday, following the developments on H1-B visa front in the US. Late on Saturday, the US announced that from April 3 it would temporarily suspend the 'premium processing' of H-1B visas that allowed some companies to jump the queue, as part of overall efforts to clear the backlog. 

On the global front, Asian markets were trading mostly higher on Monday, despite the prospects of a likely interest rate hike by the US Federal Reserve later this month as well as slower Chinese economic growth this year. In a speech to the national legislature, Premier Li Keqiang, China's top economic official, trimmed the country's growth target to 6.5 per cent and warned of dangers from global pressure for trade controls as Beijing tries to build a consumer-driven economy and reduce reliance on exports and investment. Meanwhile, Japanese shares fell as the yen firmed and as global geopolitical tensions rose after North Korea fired four missiles, three of which landed in Japan's exclusive economic zone.

Back home, stocks from Energy, Oil & Gas and Power counters were supporting the markets’ uptrend, while those from Consumer Durables, IT and Teck counters were adding to the underlying cautious undertone. In scrip specific development, Bharti Airtel gained after Bharti Airtel and Millicom International Cellular S.A. (Millicom) through their respective subsidiaries have entered into an agreement for Tigo Ghana and Airtel Ghana to combine their operations in Ghana. Moreover, ARSS Infrastructure Projects gained after the company’s joint venture (JV) - ARSS-SIPS, has bagged a work order amounting to Rs 140.52 crore from Rail Vikas Nigam.

The market breadth remained optimistic, as there were 1456 shares on the gaining side against 1051 shares on the losing side, while 153 shares remained unchanged.

The BSE Sensex is currently trading at 29008.33, up by 175.88 points or 0.61% after trading in a range of 28856.12 and 29070.20. 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 0.40%, while Small cap index up by 0.48%.

The top gaining sectoral indices on the BSE were Energy up by 2.04%, Oil & Gas up by 1.30%, Power up by 1.01%, Auto up by 0.91% and PSU up by 0.90%, while Consumer Durables down by 0.32%, IT down by 0.25%, TECK down by 0.19%, Realty down by 0.08% and Healthcare down by 0.01% were the top losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 3.58%, Power Grid up by 2.07%, NTPC up by 1.51%, Tata Motors up by 1.00% and Asian Paints up by 0.99%. On the flip side, Sun Pharma down by 1.36%, Hindustan Unilever down by 1.01%, TCS down by 0.98%, Wipro down by 0.38% and GAIL India down by 0.19% were the top losers.

Meanwhile, supported by government’s various initiatives to improve ease of doing business,  Foreign Direct Investment (FDI) into the country’s services sector increased by 77.6 percent to $7.55 billion during April- December 2016-17, as compared to $ 4.25 billion in the same period last year. Moreover, the overall foreign inflows in the country increased by 22 per cent to $35.84 billion during April-December 2016-17.

Indian services sector, which includes banking, insurance, R&D, outsourcing, courier and technology testing, represents over 60 per cent share in the country’s GDP and accounts for 17 per cent of total foreign investment inflows. The Commerce and Industry Ministry is also considering relaxing FDI norms in certain sectors including retail to further boost inflows. The other sectors where inflows recorded growth during the nine-month period of 2016-17 were telecom, which saw an inflow of $5.54 billion, trading $2 billion, computer software and hardware $1.81 billion and automobile at $1.45 billion.

FDI is considered crucial for economic development of a country and to attract maximum FDI into the country, the government has been relaxing the foreign investment norms in various sectors. At present, the Commerce and Industry Ministry is also considering relaxing FDI norms in certain sectors including retail to further boost inflows. Meanwhile, India needs around $1 trillion to overhaul its infrastructure sector such as ports, airports and highways to boost growth.

The CNX Nifty is currently trading at 8951.75, up by 54.20 points or 0.61% after trading in a range of 8914.00 and 8967.80. There were 38 stocks advancing against 12 stocks declining on the index, while one stock remained unchanged.

The top gainers on Nifty were Reliance Industries up by 3.69%, Indusind Bank up by 2.17%, Power Grid up by 2.10%, Eicher Motors up by 1.35% and NTPC up by 1.35%. On the flip side, Grasim Industries down by 1.32%, Sun Pharma down by 1.32%, Idea Cellular down by 1.22%, Zee Entertainment down by 1.16% and TCS down by 1.04% were the top losers.

The Asian markets were trading mostly in green; Jakarta Composite was up by 3.17 points or 0.06% to 5,394.38, KOSPI Index rose 3.32 points or 0.16% to 2,082.07, Shanghai Composite gained 8.41 points or 0.26% to 3,226.72, FTSE Bursa Malaysia KLCI surged by 10.96 points or 0.64% to 1,719.34, Taiwan Weighted increased by 34.42 points or 0.36% to 9,682.63 and Hang Seng was up by 74.06 points or 0.31% to 23,626.78.

On the other hand, Nikkei 225 was down by 86.26 points or 0.44% to 19,382.91.