Benchmarks continue firm trade; Bankex leads

Indian equity benchmarks continued their firm trade in late morning session on account of buying in frontline blue chip counters. The rupee opened higher against dollar on account of some selling of American currency by banks and exporters. Foreign Portfolio Investors stood net buyers in domestic equity markets on Thursday as they bought shares worth Rs 210.57 crore with gross purchases and gross sales of Rs 6619.87 crore and Rs 6409.30 crore, respectively, according to the data available with depository NSDL. Traders were drawing support with Finance minister Arun Jaitley statement that legislation related to Goods and Services Tax (GST) will have to be passed in the ongoing budget session, pointing out that the Centre and the states would otherwise lose their right to collect indirect taxes after September 15. Jaitley said four bills supporting the Constitution amendment law on GST enacted last year will be introduced in the Lok Sabha shortly. Separately, the government has exempted FIIs from taxation of indirect transfers of Indian assets made after 2011 but has left prior period cases open for interpretation. The Finance Bill 2017 approved with 40 amendments to different laws, exempts FIIs for an assessment year commencing on or after April 1, 2012 but before April 1, 2015.

Traders were seen piling position in Bankex, Consumer Durables and PSU stocks, while selling was witnessed in IT and TECK sector stocks. Banking stocks were taking support from Finance Minister Arun Jaitley statement that the government is going to announce a policy to push for the quick settlement of the non-performing assets (NPA) at banks in a couple of days. Jaitley added that this is in line with the government’s plan to quickly charter out a resolution mechanism to resolve and recover the mounting bad loans in the banking sector, especially public sector banks. In scrip specific development, Reliance Infrastructure was trading in green after the Anil Ambani-led company emerged as the lowest bidder for Rs 800 crore highway construction job in Tamil Nadu.

On the global front, Asian shares were trading mostly in red, as investors eyed US political developments on a healthcare bill that is seen as a litmus test of President Donald Trump’s ability to get ambitious tax and spending plans passed as well. Bank of Japan Governor Haruhiko Kuroda said there is no reason to withdraw the bank’s massive monetary stimulus now as inflation remains distant from its 2 percent target. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 9,100 and 29,400 levels respectively. The market breadth on BSE was positive in the ratio of 1448:805, while 131 scrips remained unchanged.

The BSE Sensex is currently trading at 29469.38, up by 137.22 points or 0.47% after trading in a range of 29350.17 and 29500.19. There were 20 stocks advancing against 9 stocks declining, while 1 stock remained unchanged 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 0.74%.

The top gaining sectoral indices on the BSE were Bankex up by 1.24%, Consumer Durables up by 1.04%, PSU up by 0.99%, Metal up by 0.89% and Realty up by 0.69%, while IT down by 0.22% and TECK down by 0.11% were the losing indices on BSE.

The top gainers on the Sensex were ICICI Bank up by 3.01%, SBI up by 2.33%, GAIL India up by 1.27%, Power Grid up by 0.98% and ITC up by 0.95%.

On the flip side, ONGC down by 0.52%, TCS down by 0.32%, Maruti Suzuki down by 0.21%, Lupin down by 0.18% and Cipla down by 0.18% were the top losers.

Meanwhile, the Commerce and Industry Minister Nirmala Sitharaman has said that the implementation of the Goods and Services Tax (GST) from July 1, 2017 will result in eliminating barriers between the States and make exports more competitive. She added that GST gives a feeling that market in India is one now and there are no barriers between regions or provinces.

Sitharaman further said that even within the country, the value chains which will get integrated, will have a simpler and straightforward flow of goods and, therefore, it should make exports more competitive rather than expensive. Recently, the Union Cabinet approved four GST legislations - the Central GST Bill, Integrated GST Bill, Union Territory GST Bill, and the Compensation Bill which had earlier been approved by the GST Council over 12 meetings spanning about six months. The Bills now need to be passed by the Parliament, while the State GST Bill needs to be passed by the legislative Assemblies of each State.

Finance Minister Arun Jaitley too had said the new indirect tax regime will ensure seamless transfer of goods and services, create one of the world's biggest single markets, while stronger information technology backbone will make evasion difficult.

The CNX Nifty is currently trading at 9123.65, up by 37.35 points or 0.41% after trading in a range of 9089.40 and 9131.95. There were 32 stocks advancing against 18 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were Bank of Baroda up by 3.45%, ICICI Bank up by 3.03%, SBI up by 2.33%, GAIL India up by 1.33% and Yes Bank up by 1.13%.
On the flip side, BPCL down by 1.27%, Tech Mahindra down by 0.92%, Grasim Industries down by 0.78%, ONGC down by 0.70% and Zee Entertainment down by 0.60% were the top losers.

The Asian markets were trading mostly in red; Taiwan Weighted decreased 36.23 points or 0.36% to 9,894.51, Hang Seng decreased 33.67 points or 0.14% to 24,294.03, Jakarta Composite decreased 6.25 points or 0.11% to 5,557.51, KOSPI Index decreased 4.64 points or 0.21% to 2,168.08 and Shanghai Composite decreased 3.58 points or 0.11% to 3,244.97.

On the other hand, FTSE Bursa Malaysia KLCI increased 0.44 points or 0.03% to 1,747.44 and Nikkei 225 increased 159.36 points or 0.83% to 19,244.67.