Markets continue to trade in positive territory

Indian equity benchmarks continued to trade in positive territory in afternoon session, as arrival of monsoon rains kept the sentiment upbeat. The monsoon, which delivers about 70% of India’s annual rainfall, arrived at the southern Kerala coast today, in line with weather office forecasts, brightening the outlook for higher farm output and robust economic growth.  Some support also came with World Bank’s report that India will grow at 7.2% in the current fiscal and further up to 7.7% by 2019-20 on strong fundamentals, reform momentum and improving investment scenario. However, gains remained capped as Securities and Exchange Board of India (Sebi) on Monday proposed to bring in tougher regulations to squeeze the use of participatory notes. Besides, traders also remained cautions with Niti Aayog Vice Chairman Arvind Panagariya’s statement that the government does not have any immediate plans to create a bad bank to resolve the bad loans issue.

On the global front, Asian markets were trading in red as investors stayed on the sideline before the release of a raft of economic data due later this week. Trading volumes remained thin across the region amid public holidays in China, Hong Kong and Taiwan. Investors also kept an eye on the U.S. jobs report due this Friday, which may bolster the case for a rate hike on June 14. Back home, in scrip specific development, Syndicate Bank edged higher after the bank received an approval to raise equity capital up to Rs 3,500 crore inclusive of premium to be decided by way of Qualified Institutional Placement/Rights Issue/Preferential Allotment / or any other mode approved by Reserve Bank of India/Government of India, at an appropriate time, subject to necessary approvals, during the financial year 2017-2018.

The BSE Sensex is currently trading at 31149.73, up by 40.45 points or 0.13% after trading in a range of 31064.04 and 31220.38. There were 22 stocks advancing against 8 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was up by 0.44%, while Small cap index was down by 0.01%.

The top gaining sectoral indices on the BSE were Healthcare up by 1.64%, Basic Materials up by 0.73%, Utilities up by 0.72%, Auto up by 0.38% and Bankex up by 0.37%, while FMCG down by 0.93%, Capital Goods down by 0.88%, Consumer Durables down by 0.80%, Realty down by 0.68% and Telecom down by 0.59% were the top losing indices on BSE.

The top gainers on the Sensex were NTPC up by 3.81%, Adani Ports & SEZ up by 2.70%, Dr. Reddys Lab up by 2.13%, Lupin up by 2.09% and ICICI Bank up by 1.94%. On the flip side, Power Grid Corpn. down by 2.13%, Coal India down by 1.81%, Hindustan Unilever down by 1.65%, ITC down by 1.42% and HDFC down by 0.86% were the top losers.

Meanwhile, terming the Goods and Services Tax (GST) as a more efficient tax structure, Finance Minister Arun Jaitley has said that the new taxation regime will make tax collection efficient, check evasion and will also help India evolve as a more tax-compliant society.  He further added that GST is a product of federal India and it would require coordination between taxation authority of the Centre and the states. In view of this, tax training academies like National Academy of Customs, Indirect Taxes and Narcotics (Nacin) will play a major role in training officials.

Jaitley noting that GST would promote single interface of taxation authorities instead of multiple interfaces, said that it will eliminate interaction between assessing authority & taxpayer and this could minimise harassment and bring greater accountability into the system. The finance minister also said that merger of various indirect taxes in one price is itself a monumental taxation change, pointing that it will require personnel to upgrade their skills and knowledge.

Finance Minister further said the GST would be India’s first federal product (policy). Also, the GST Council would be the first federal institute where the Centre and the states decide policies in co-ordination. The GST is slated for a July 1 roll-out and the GST Council had finalised rates of several goods and services in four slabs which are 5 per cent, 12 per cent, 18 per cent and 28 per cent.

The CNX Nifty is currently trading at 9611.75, up by 6.85 points or 0.07% after trading in a range of 9581.20 and 9631.60. There were 33 stocks advancing against 18 stocks declining on the index.

The top gainers on Nifty were Aurobindo Pharma up by 9.07%, NTPC up by 3.77%, Hindalco up by 3.23%, Adani Ports & SEZ up by 2.65% and Dr. Reddys Lab up by 2.34%. On the flip side, Bharti Infratel down by 3.08%, BPCL down by 3.01%, Power Grid Corpn. down by 2.44%, Zee Entertainment down by 1.75% and Coal India down by 1.52% were the top losers.

Asian markets were trading mostly in red; KOSPI Index decreased 9.29 points or 0.39% to 2,343.68, Nikkei 225 decreased 4.72 points or 0.02% to 19,677.85 and FTSE Bursa Malaysia KLCI decreased 1.36 points or 0.08% to 1,763.53. On the flip side, Jakarta Composite increased 11.01 points or 0.19% to 5,723.34.