Benchmarks turn green after a soft start; Sensex surpasses 30,600 mark

Indian equity benchmarks have entered into green terrain, after making a soft start, with frontline gauges trading comfortably above their crucial 30,600 (Sensex) and 9,500 (Nifty) bastions. Sentiments remained up-beat on good monsoon prediction with India Meteorological Department stating that the southwest monsoon is likely to hit the Indian mainland on May 30, two days ahead of the normal onset of June 1, with favourable conditions building up and likely to prevail during the next few days. Meanwhile, ahead of the planned GST rollout from July 1, the government is strengthening the body responsible for detecting tax evasion and will set up two new agencies, including one for business intelligence and analytics.

On the global front, Asian markets were trading in red as traders remained concerned over the turmoil engulfing President Donald Trump’s administration. The Japanese market turned lower as the yen strengthened against the dollar. The US markets made a mixed closing in last session after a choppy session of trade, but despite the choppy trading on the day, tech-heavy Nasdaq reached another new record closing high.

Back home, stocks related to software counter kept buzzing, as the government has downplayed job losses in the IT sector, citing retrenchment and automation. In scrip specific developments, Tata Steel gained over 4% after it reported a stellar set of numbers for the fourth quarter on a standalone basis, which was largely boosted by an outperformance by operating profits. Realty firm Sobha surged over 7% after it reported 70% increase in its consolidated net profit at Rs 47 crore for the quarter ended March. Its net profit stood at Rs 27.6 crore in the year-ago period.

The BSE Sensex is currently trading at 30617.62, up by 35.02 points or 0.11% after trading in a range of 30519.14 and 30625.85. There were 17 stocks advancing against 12 stocks declining on the index, while one stock remained unchanged.

The broader indices were trading in green; the BSE Mid cap index gained 0.18%, while Small cap index was up by 0.14%.

The top gaining sectoral indices on the BSE were Metal up by 1.74%, Realty up by 0.69%, Telecom up by 0.68%, Capital Goods up by 0.54% and Basic Materials up by 0.32%, while FMCG down by 0.55%, IT down by 0.33%, Consumer Durables down by 0.24% and TECK down by 0.19% were the few losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 4.51%, ICICI Bank up by 1.44%, Bharti Airtel up by 1.16%, Hero MotoCorp up by 1.08% and Lupin up by 1.02%. On the flip side, ITC down by 1.15%, Dr. Reddys Lab down by 1.02%, Wipro down by 0.72%, GAIL India down by 0.51% and Sun Pharma down by 0.48% were the top losers.

Meanwhile, the government is planning to further empower the body responsible for detecting tax evasion, before the roll out of much awaited goods and services tax (GST) from July 1, 2017. Along with this, two new agencies will also be formed, in which one will be for business intelligence and analytics. The GST will include central levies like excise duty, service tax and state VAT. For this, the Central Board of Excise and Customs (CBEC) has changed its existing central excise and service tax field formations to suit the requirements of the new regime. The CBEC will be renamed as the Central Board of Indirect Taxes and Customs (CBIC) and will supervise GST and Customs activities and provide the government policy inputs.

The CBIC will be headed by a chairman and will have six members -- for GST; IT, legal and compliance verification; investigation; tax policy; Customs and administration and vigilance. The CBEC’s human resource arm has stated that the name of the present Directorate General of Central Excise Intelligence (DGCEI) will be changed to Directorate General of GST Intelligence (DGGSTI) with more powers.

The DGSTI will have its task cut out, keeping in view the steep increase in the GST taxpayer base. The organisation will be headed by a principal director general in Delhi who will be assisted by four sub-national directors general. Also, two new directorates are being created. The Directorate General of Analytics and Risk Management (DGARM) will have two verticals for business intelligence and analytics and risk management centre to provide perspectives for policy formulation. The Directorate of International Customs will be created to deal with WTO related matters, including tariff, as well as the Kyoto Convention, multilateral and bi-lateral agreements with other countries.

Further, the National Academy of Customs, Indirect Taxes and Narcotics (NACIN), will be the new form of the existing National Academy of Customs, Excise and Narcotics (NACEN). In the GST regime, it will be the only academy of its kind in India that will provide regular training to officers. It is also envisaged that the NACIN will provide training to representatives of trade bodies and tax professionals. Thus, it will be catering to the training needs of around 70,000 persons every year.

The CNX Nifty is currently trading at 9514.10, up by 1.85 points or 0.02% after trading in a range of 9489.70 and 9521.00. There were 20 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were Tata Steel up by 4.74%, Indiabulls Housing up by 1.85%, ICICI Bank up by 1.64%, Aurobindo Pharma up by 1.38% and Hindalco up by 1.35%. On the flip side, Tech Mahindra down by 2.11%, Dr. Reddys Lab down by 1.13%, Bosch down by 1.12%, ITC down by 1.11% and Kotak Mahindra Bank down by 1.10% were the top losers.

Asian markets were trading in red; Nikkei 225 decreased 112.46 points or 0.56% to 19,807.36, Hang Seng slipped 67.83 points or 0.27% to 25,268.11, Taiwan Weighted dropped 56.46 points or 0.56% to 9,975.03, Jakarta Composite shed 22.74 points or 0.4% to 5,624.26, KOSPI Index fell 8.12 points or 0.35% to 2,287.21, FTSE Bursa Malaysia KLCI dipped 5.73 points or 0.32% to 1,772.42 and Shanghai Composite was down by 3.25 points or 0.1% to 3,109.71.