Benchmarks trade with modest gains in late morning session

Indian equity benchmarks continued their modest trade in green in late morning session on account of buying in frontline blue chip counters ahead of F&O expiry. The rupee extended its gains and opened higher against dollar on account of selling of dollar by speculative traders and exporters. India’s economic fundamentals looks strong which has prompted the foreign investors to park their funds in rupee denominated assets. Sustained buying by FIIs has pushed the rupee higher. Sentiments got a leg up after the much-awaited tax reform -- Goods and Services Tax (GST) -- inched closer to its July 1 rollout date. The four GST Bills were passed after an eight-hour marathon debate in the Lower House. The unified tax regime is expected to boost economic growth by about 0.5 percentage points in its first year of implementation. Some buying also crept in after Finance Secretary Ashok Lavasa termed the Aadhaar card scheme as revolutionary, saying it has helped the government save Rs 34,000 crore.  Lavasa pointed that Aadhaar was linked to a whole gamut of public expenditure, which is a matter of concern not only for those who want more efficiency in public spending but also those concerned with transparency and removal of corruption.

Meanwhile, according to a poll, India’s benchmark BSE Sensex share index will scale a new record high by mid-year. This more bullish view emerges from the poll despite widespread concern since the last poll over the damage a disruptive and radical government move to replace the bulk of currency in circulation may have done to the economy. Traders were seen piling position in Realty, Consumer Durables and Industrials stocks, while selling was witnessed in Telecom sector stocks. In scrip specific development, Dilip Buildcon was trading in green on receiving Letter of Award (LoA) from the National Highways Authority of India (NHAI) (Ministry of Road Transport & Highways, Government of India) for three projects in a single stretch in the state of Maharashtra. The market may remain volatile this week as traders may roll over positions in the Futures & Options (F&O) segment from the near month i.e. March 2017 series to next month i.e. April 2017 series. The near month March 2017 derivatives contracts will expire today i.e. March 30, 2017.

On the global front, Asian shares were trading in red, with sentiment downbeat over the likely hard slog ahead for the UK to exit the European Union. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 9,150 and 29,600 levels respectively. The market breadth on BSE was positive in the ratio of 1612:571, while 148 scrips remained unchanged.

The BSE Sensex is currently trading at 29614.30, up by 82.87 points or 0.28% after trading in a range of 29521.65 and 29645.88. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.50%, while Small cap index was up by 0.90%.

The top gaining sectoral indices on the BSE were Realty up by 2.49%, Consumer Durables up by 1.55%, Industrials up by 0.78%, Capital Goods up by 0.73% and Consumer Disc up by 0.67%, while Telecom down by 0.17% was the sole loser on BSE.

The top gainers on the Sensex were Adani Ports & Special Economic Zone up by 3.70%, SBI up by 1.27%, Hero MotoCorp up by 0.90%, Hindustan Unilever up by 0.73% and Maruti Suzuki up by 0.71%.

On the flip side, Coal India down by 0.51%, Axis Bank down by 0.46%, Bharti Airtel down by 0.41%, Tata Motors down by 0.37% and Lupin down by 0.27% were the top losers.

Meanwhile, dismissing the fears of price rise of goods and commodities after the roll out of the Goods and Services Tax (GST), Finance Minister Arun Jaitley has said that the tax rates will be kept at the current level and will not affect inflation. He also said that the purpose of GST Council is to ensure that all the things related to the tax structure are with consent and this is the first time such arrangements have been made on the basis of the principle of shared ownership of both the Central and State Governments.

This historic tax reform is now a step closer to meet its July 1 target of rollout, with the Lok Sabha approving four supplementary legislations. The GST bill would bring the country under single tax net for the first time. The legislations were passed after negation of a host of amendments moved by the opposition parties. GST will subsume a host of indirect taxes levied by the Centre and states, including excise duty, VAT, service tax, entry, luxury and entertainment levies. Finance Minister had presented four under the GST for consideration in parliament.

Jaitley further said that the Central GST or CGST will give powers to the Centre to levy tax after levies of excise, service tax and additional customs duty is subsumed. The Integrated GST or IGST will be a tax to be levied by the Centre on inter-state movement of goods and services. The State GST or SGST law will allow states to levy sales tax after levies like VAT are subsumed. Besides, GST compensation law allows for imposition of cess on certain luxury goods like tobacco, high-end cars and aerated drinks to create a corpus for compensating states for any loss of revenue in the first five years of GST roll out. The fourth law is on Union Territory GST or UTGST for UTs like Chandigarh and Daman and Diu which do not have assemblies. Jaitley added that all decisions on GST would be taken by the GST Council, reflecting the federal structure.

The CNX Nifty is currently trading at 9161.40, up by 17.60 points or 0.19% after trading in a range of 9136.35 and 9169.65. There were 27 stocks advancing against 24 stocks declining on the index.

The top gainers on Nifty were Adani Ports & Special Economic Zone up by 3.46%, Kotak Mahindra Bank up by 1.14%, Aurobindo Pharma up by 1.13%, IndusInd Bank up by 1.03% and SBI up by 1.02%.

On the flip side, Bharti Infratel down by 0.86%, Wipro down by 0.66%, Ambuja Cement down by 0.65%, Axis Bank down by 0.56% and Idea Cellular down by 0.56% were the top losers.

The Asian markets were trading in red; Nikkei 225 decreased 147.7 points or 0.77% to 19,069.78, Hang Seng decreased 127.62 points or 0.52% to 24,264.43, Shanghai Composite decreased 44.12 points or 1.36% to 3,197.19, Jakarta Composite decreased 27.53 points or 0.49% to 5,564.98, KOSPI Index decreased 4.79 points or 0.22% to 2,162.19, FTSE Bursa Malaysia KLCI decreased 3.48 points or 0.2% to 1,746.93 and Taiwan Weighted decreased 1.71 points or 0.02% to 9,854.54.