Benchmarks extend losses; Nifty below 9,950 mark

Indian equity benchmarks extended their losses in the morning session on account of selling in frontline blue chip counters weighed by geopolitical tensions surrounding around North Korea after its latest hydrogen bomb test. The rupee opened higher against dollar on account of selling of American currency by banks and exporters. Foreign Portfolio Investors stood net buyers in domestic equity markets on Friday and bought shares worth Rs 443.91 crore with gross purchases and gross sales of Rs 8,453.97 crore and Rs 8,010.06 crore, respectively. The sentiments were under pressure taking cue from foreign brokerage report that investment continued to slip to 27.5 percent of GDP, from 29.2 percent in June 2016, with high lending rates dampening demand and sustaining excess capacity. It added that lending rate cuts are key to economic growth recovery and banks should lower rates by 25 bps before the start of the busy season in October to accelerate reforms momentum. Separately, another global brokerage firm lowered India’s GDP growth forecast to 6.6 percent for this fiscal from 7.2 percent earlier. The brokerage said that the growth is expected to pick up in coming quarters as the economy normalizes post implementation of the GST. According to official data, India’s economic growth slipped to a three-year low of 5.7 percent in April-June as disruptions caused by demonetization spilled over to the third straight quarter amid a slowdown in manufacturing activities.

Investors took note of the report that the country’s former central bank head Raghuram Rajan had cautioned the government that short-term costs of a radical ban of high-value currency notes would outweigh the long-term benefits. Traders were seen piling up position in Energy, Metal and Oil & Gas stocks, while selling was witnessed in Realty, Telecom and Capital Goods sector stocks. In scrip specific development, Jubilant Life Sciences was trading in green as its subsidiary ‘Jubilant Pharma’ has completed the acquisition of the US radiopharmacy business of Triad Isotopes Inc. Triad operates the second largest radiopharmacy network in the US with more than 50 pharmacies.

On the global front, Asian markets were trading mostly in red, after a weekend nuclear weapons test by North Korea that Pyongyang claimed was a hydrogen bomb capable of fitting onto an ICBM. Back home, the BSE Sensex and NSE Nifty were trading below the psychological 31,800 and 9,950 levels respectively. The market breadth on BSE was negative in the ratio of 1001:1172, while 96 scrips remained unchanged.

The BSE Sensex is currently trading at 31785.09, down by 107.14 points or 0.34% after trading in a range of 31763.77 and 31932.20. There were 8 stocks advancing against 23 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.08%, while Small cap index was down by 0.18%.

The top gaining sectoral indices on the BSE were Energy up by 0.58%, Metal up by 0.49%, Oil & Gas up by 0.08% and PSU up by 0.03%, while Realty down by 0.83%, Telecom down by 0.78%, Capital Goods down by 0.50%, Consumer Durables down by 0.46% and TECK down by 0.42% were the losing indices on BSE.

The top gainers on the Sensex were Coal India up by 2.22%, Reliance Industries up by 1.02%, Tata Motors up by 0.41%, SBI up by 0.23% and ONGC up by 0.19%.

On the flip side, Adani Ports & Special Economic Zone down by 2.29%, Asian Paints down by 1.42%, Bharti Airtel down by 1.07%, Sun Pharma down by 1.02% and Kotak Mahindra Bank down by 0.97% were the top losers.

Meanwhile, the government, on the recommendations of the Goods and Services Tax Council, has waived the penalty of Rs 200 per day for taxpayers who failed to file the first GST returns within the deadline. The taxpayers will, however, have to bear the interest on late payment of dues.

The Finance Ministry elaborating the same said that late fee for all taxpayers who could not file GSTR-3B for month of July has been waived, but not the interest on late payment of dues. Interest will be applicable to all taxpayers who have not discharged their complete GST liability for July by August 25.

A Finance Ministry circular also said that taxpayers who might have made errors in filing the first GST returns could make corrections while filing the GSTR-1 and GSTR-2 forms for the month of July. Form GSTR-1 reflects sales of a business, while GSTR-2 reflects purchases. It stated that there would be a reconciliation of the forms to see if there was any mismatch and the under-reporting or excess-reporting of the tax would thus be corrected. The corrected data would be auto-populated and reflected in GSTR-3, which is a combination of sales and purchases.

Earlier, Finance Minister Arun Jaitley had said that a total of about 5.95 million taxpayers for July should have filed the GST returns, but till August 29 only about 3.83 million or 64.42 per cent had complied, he had further said that the taxpayers who failed to meet the deadline will have to bear a penalty of Rs 200 per day -- Rs 100 for Central GST and Rs 100 for State GST.

The CNX Nifty is currently trading at 9942.40, down by 32.00 points or 0.32% after trading in a range of 9936.30 and 9988.40. There were 15 stocks advancing against 36 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing up by 2.46%, Coal India up by 2.18%, BPCL up by 1.09%, Reliance Industries up by 0.97% and Vedanta up by 0.79%.

On the flip side, Indian Oil down by 2.58%, Adani Ports & Special Economic Zone down by 2.44%, Ambuja Cement down by 1.88%, Asian Paints down by 1.47% and Tata Power down by 1.37% were the top losers.

The Asian markets were trading mostly in red; Nikkei 225 decreased 182.62 points or 0.93% to 19,508.85, Hang Seng decreased 138.13 points or 0.49% to 27,815.03, Jakarta Composite decreased 34.47 points or 0.59% to 5,829.59, Taiwan Weighted decreased 21.47 points or 0.2% to 10,573.35 and KOSPI Index decreased 17.19 points or 0.73% to 2,340.50.

On the other hand, Shanghai Composite increased 5.98 points or 0.18% to 3,373.10 and FTSE Bursa Malaysia KLCI increased 12.02 points or 0.68% to 1,773.16.