Benchmarks trade jubilantly in early deals; Sensex re-conquers 31,000 mark

Buoyed by firm global cues, Indian equity benchmarks have made a gap-up opening and are trading jubilantly in early deals on Thursday with frontline gauges recapturing their crucial 31,000 (Sensex) and 9,550 (Nifty) levels. Traders took some support with India Meteorological Department’s (IMD) statement that 79 percent of the country has received normal-to-above-normal rainfall. It is seeing a steady progress in rainfall in central India and expects average July rainfall at 96 percent. Moreover, it maintains monsoon projection at 98 percent as was predicted in June.

Supportive global cues too aided sentiments, with regional counters rallying at this point of time taking cues from a stronger finish in US markets, with traders expected to digest comments from top central bankers overnight. The US markets ended in green terrain on Wednesday on bargain hunting, as traders picked up stocks at relatively reduced levels following yesterday’s weakness.

Back home, there was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too participated strongly in the rally. In scrip specific developments, Axis Bank gained by around four percent after it raised Rs 3,500 crore by issuing debt securities on a private placement basis. Shares of the Eris Lifesciences, which made a debut on the stock market today, was up 1% as against its issue price. The company’s IPO was oversubscribed 3.29 times during June 16-20. The market breadth remained in favor of advances, as there were 1,501 shares on the gaining side against 305 shares on the losing side while 67 shares remain unchanged.

The BSE Sensex is currently trading at 31063.48, up by 229.16 points or 0.74% after trading in a range of 30905.86 and 31065.02. There were 27 stocks advancing against 4 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.84%, while Small cap index was up by 1.25%.

The top gaining sectoral indices on the BSE were Telecom up by 1.28%, Metal up by 1.22%, Capital Goods up by 1.20%, Industrials up by 1.15% and Basic Materials up by 1.11%, while there were no losers on the BSE sectoral front.

The top gainers on the Sensex were Axis Bank up by 3.54%, Tata Steel up by 1.81%, Infosys up by 1.54%, Bharti Airtel up by 1.50% and Mahindra & Mahindra up by 1.38%. On the flip side, Sun Pharma down by 0.70%, Wipro down by 0.58%, Lupin down by 0.37% and Kotak Mahindra Bank down by 0.36% were the top losers.

Meanwhile, appreciating the government's decision to defer the enforcement of Tax Collection at Source (TCS) provision under the Goods and Services Tax (GST) regime, the Federation of Indian Chambers of Commerce and Industry (FICCI) has said that the decision will boost e-commerce. The industry body further noted deferment of TCS as a welcome step, saying that the immediate enforcement of TCS under GST would have slowed down the growth of e-commerce with consequential negative impact on economic growth, job creation, and infrastructure investments and possibly tax collections itself.

The industry body said that TCS would have a direct impact on the sellers of the marketplace, who are generally small in nature with a turnover in the range of Rs 50 lakh to Rs 10 crore per annum. Besides, it said that TCS could have disrupted the cash flow, thereby disrupting the level playing field between online selling and offline selling, and discouraged sellers particularly SMEs from selling online. FICCI further expressed need of right policy frameworks and guidelines for the sector in order to make it more productive.

The government postponed the Tax Deducted at Source (TDS) and TCS provisions for the time being after the feedback received from trade and industry. Besides, persons supplying goods or services through an electronic commerce operator and liable to collect tax at source will not be required to register immediately until the TCS provision is brought into force.  The decision was taken to provide more time for persons liable to deduct tax at source, e-commerce companies and their suppliers to prepare for the rollout of the forthcoming tax regime.

The CNX Nifty is currently trading at 9556.25, up by 65.00 points or 0.68% after trading in a range of 9522.45 and 9558.55. There were 43 stocks advancing against 8 stocks declining on the index.

The top gainers on Nifty were Axis Bank up by 4.10%, Tata Steel up by 1.65%, Bharti Airtel up by 1.64%, ACC up by 1.63% and Hindalco up by 1.58%. On the flip side, Sun Pharma down by 0.75%, NTPC down by 0.50%, Wipro down by 0.48%, Aurobindo Pharma down by 0.30% and Lupin down by 0.29% were the top losers.

Asian markets were trading in green; FTSE Bursa Malaysia KLCI rose 0.59 points or 0.03% to 1,771.82, Shanghai Composite increased 10 points or 0.32% to 3,183.21, KOSPI Index surged 14.51 points or 0.61% to 2,397.07, Taiwan Weighted gained 45.69 points or 0.44% to 10,436.24, Nikkei 225 added 109.98 points or 0.55% to 20,240.39 and Hang Seng was up by 227.08 points or 0.88% to 25,910.58.