Sensex, Nifty continue strong trade; realty stocks steal the show

Indian equity benchmarks continued to trade on strong note in late afternoon session on heavy buying on realty, Telecom and PSU counters despite mixed European markets. A blog posted on Asian Development Bank's website, stating that the goods and services tax in India will benefit the lower and lower-middle income class as it is likely to reduce the tax rate on goods, continued to support the sentiments. Some support also came with the launch of the Mentor India Campaign, a strategic nation building initiative to engage leaders who can nurture and guide students at more than 900 Atal Tinkering Labs. Besides, positive Asian markets too contributed to the gains. Meanwhile, the income tax department is open to lowering the withholding tax rate for foreign companies which have income in India.

On the global front, European markets were trading mixed, as traders paused for breath after a global rally spurred by gains for tech stocks in the US. Asian markets were trading in green. Back home, in scrip specific development, Hindustan Copper was trading higher after the company restarted mining operation of Surda Mine located at Ghatsila, Jharkhand with effect from August 21, 2017. Surda mine has the capacity to produce 4 lakh tonne of copper ore annually.

The BSE Sensex is currently trading at 31418.03, up by 126.18 points or 0.40% after trading in a range of 31379.25 and 31494.16. There were 20 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.82%, while Small cap index was up by 0.79%.

The top gaining sectoral indices on the BSE were Realty up by 2.65%, Telecom up by 1.04%, Bankex up by 0.72%, PSU up by 0.70% and Industrials up by 0.53%, while Consumer Durables down by 0.91% and FMCG down by 0.02% were the only losing indices on BSE.

The top gainers on the Sensex were Dr. Reddy’s Lab up by 2.52%, Adani Ports & SEZ up by 1.87%, Bharti Airtel up by 1.71%, Infosys up by 1.58% and Tata Motors up by 1.30%. On the flip side, Hindustan Unilever down by 1.15%, TCS down by 0.58%, Mahindra & Mahindra down by 0.43%, Sun Pharma down by 0.39% and Hero MotoCorp down by 0.34% were the top losers.

Meanwhile, terming the rollout of the Goods and Services Tax (GST) in India beneficial for the lower and lower-middle income class as it is likely to reduce the tax rate on goods, a blog on Asian Development Bank (ADB) has said that tax rate on goods is likely to be reduced as compared to previously with new tax regime and this will benefit the lower and lower-middle income class by lowering their burden.

An international development finance institution is however, expecting increment in services’ tax rates on account of GST and added that GST might put burden on upper middle-income and high-income households. It further noted that the impact on overall economy business, households and government organisations is expected to be multi-faceted.

The blog said that as household bundle of goods and services differs with income level, preferences, age composition and other factors under the GST regime, the impact of it may also vary across households. It praised the government’s initiatives along with the design and time of launching of GST, saying that the timing has been favourable from global and domestic perspective in minimising the impact of it on cost of living.

The CNX Nifty is currently trading at 9791.45, up by 25.90 points or 0.27% after trading in a range of 9786.75 and 9820.80. There were 26 stocks advancing against 25 stocks declining on the index.

The top gainers on Nifty were Dr. Reddy’s Lab up by 2.60%, Indiabulls Housing Finance up by 2.55%, GAIL India up by 1.97%, Adani Ports & SEZ up by 1.69% and Infosys up by 1.54%. On the flip side, Tech Mahindra down by 2.50%, Eicher Motors down by 2.18%, Tata Power down by 1.69%, Bharti Infratel down by 1.68% and Hindalco down by 1.18% were the top losers.

Asian markets were trading mostly in green; KOSPI Index increased 1.07 points or 0.05% to 2,366.40, Taiwan Weighted increased 14.74 points or 0.14% to 10,406.81, Jakarta Composite increased 19.98 points or 0.34% to 5,900.28 and Nikkei 225 increased 50.8 points or 0.26% to 19,434.64. On the flip side, Shanghai Composite decreased 2.52 points or 0.08% to 3,287.71 and FTSE Bursa Malaysia KLCI decreased 1.86 points or 0.1% to 1,772.36.

European Markets were trading mixed; Germany’s DAX decreased 12.61 points or 0.1% to 12,216.73 and France’s CAC decreased 3.33 points or 0.06% to 5,128.53. On the flip side, UK’s FTSE 100 increased 3.13 points or 0.04% to 7,384.87.