Benchmarks continue firm trade in noon session

Maintaining most of their early gains, Indian benchmark indices continued to trade firm in noon session as investors remained optimistic after the goods and services tax (GST) council on Thursday gave its nod to the two remaining pieces of supporting legislation for implementing the landmark tax reform, paving the way for their introduction in Parliament and state legislatures. The council’s approval for the state GST and Union territory GST bills marks an important step in India’s journey towards creating a unified market and is critical to meeting the deadline of July 1 for GST implementation. Some support also came with the Commerce Minister Nirmala Sitharaman’s statement that the country's engineering exports are likely to reach over $60 billion during the current financial year on the back of revival of demand in the US. During April-January period of 2016-17, the engineering exports have touched $50.87 billion, exceeding the total shipments of $49 billion in 2015. However, snapping its four-session long gains, the rupee fell 24 paise to 65.65 against the dollar on Friday as the American currency got some of its lure back among banks and importers. Meanwhile, cigarette stocks such as ITC gained traction after the GST Council capped the cess on tobacco and cigarettes at 290% or Rs 4,170 per 1,000 cigarette sticks. 

On the global front, most of the Asian markets edged higher on Friday, despite the negative cues from Wall Street and lower crude oil prices overnight. Investors continued to remain cheerful after the US Federal Reserve maintained its interest rate forecast for this year. While the Fed raised rates by quarter a point as widely expected on Wednesday, the central bank's projections called for only two more rate hikes this year. The unchanged outlook for rate hikes this year offset concerns that the Fed intends to accelerate the pace of rate increases. Meanwhile, President Donald Trump's first budget outline, calling for a security-heavy realignment of federal spending, drew resistance on Thursday from his fellow Republicans in the US Congress as many balked at proposed deep cuts to diplomatic and foreign aid programs.

Back home, stocks from FMCG and Realty counters were supporting the markets’ uptrend, while those from Telecom, Capital Goods and Utilities counters were adding to the underlying cautious undertone. In scrip specific development, MTNL stocks surged on the reports that a Parliamentary panel has suggested merger of state-run telecom firms BSNL and MTNL for their long-term survival. Furthermore, Nocil gained after the company’s board of directors approved expansion of capacities of rubber chemicals and their intermediates at the company’s plants situated at Navi Mumbai and Dahej.

The market breadth remained pessimistic, as there were 1071 shares on the gaining side against 1367 shares on the losing side, while 159 shares remained unchanged.

The BSE Sensex is currently trading at 29697.21, up by 111.36 points or 0.38% after trading in a range of 29659.40 and 29824.62. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.41%, while Small cap index down by 0.09%.

The only gaining sectoral indices on the BSE were FMCG up by 3.37% and Realty up by 0.08%, while Telecom down by 1.85%, Capital Goods down by 0.76%, Utilities down by 0.71%, PSU down by 0.66% and Power down by 0.58% were the top losing indices on BSE.

The top gainers on the Sensex were ITC up by 7.20%, Maruti Suzuki up by 1.14%, Lupin up by 0.87%, Axis Bank up by 0.52% and Tata Steel up by 0.47%. On the flip side, Bharti Airtel down by 1.98%, Bajaj Auto down by 1.25%, Larsen & Toubro down by 1.22%, GAIL India down by 1.07% and ICICI Bank down by 1.05% were the top losers.

Meanwhile, in order to maintain the country’s export growth rate in a challenging global environment, the Federation of Indian Export Organisations (FIEO) has launched Trade Infrastructure for Export Scheme (TIES). The scheme has been launched for developing export-linked infrastructure in states to boost outbound shipments. It will help create modern infrastructure like last mile connectivity to ports, besides testing labs and certification centres.

FIEO has said that it will go a long way in creating modern infrastructure and cut down transaction cost. It will address various other challenges and export bottlenecks, thereby helping in reduction of overall transaction and logistics costs. The scheme, to be implemented from April 1, would have a budgetary allocation of Rs 600 crore for three years with an annual outlay of Rs 200 crore.

The Export Organizations body said that their organization is looking at more export friendly measures. Besides, it has said that the government may provide additional incentives to exporters to offset losses on exchange front. It said that the Interest Equalisation Scheme is available only for manufacturers and the government needs to look into this Scheme for merchant exporters too, who continue to contribute 30 per cent of the country's exports and it should be extended to other sectors as well.

The CNX Nifty is currently trading at 9163.00, up by 9.30 points or 0.10% after trading in a range of 9153.20 and 9218.40. There were 14 stocks advancing against 37 stocks declining on the index.

The top gainers on Nifty were ITC up by 7.35%, Lupin up by 1.09%, HCL Tech up by 0.88%, Wipro up by 0.84% and Maruti Suzuki up by 0.77%. On the flip side, Idea Cellular down by 3.76%, Bharti Airtel down by 2.22%, Tata Motors - DVR down by 2.05%, Aurobindo Pharma down by 1.86% and Bank Of Baroda down by 1.51% were the top losers.

Asian markets were trading mostly in green; KOSPI Index gained 0.56%, FTSE Bursa Malaysia KLCI increased 0.61%, Jakarta Composite rose 0.27%, Taiwan Weighted added 0.72% and Hang Seng was up by 0.3%. On the flip side, Nikkei 225 decreased 0.33% and Shanghai Composite was down by 0.19%.