Benchmarks trade in green in morning session

Indian equity benchmarks continued their trade in green in the morning session on account of buying in frontline blue chip counters tracking global cues. The rupee appreciated against the US currency on account of dollar selling by banks and exporters and foreign fund inflows. FPIs turned net buyers in equity and debt markets yesterday after two days of selling. They invested Rs 272.03 crore on net basis yesterday, as per provisional data. Traders took support on foreign brokerage report which enlightened that economic activity in the country lost some pace amid GST related disruptions but underlying growth momentum remains strong and the country may clock 6.7 percent growth this fiscal. It further said that a number of high frequency growth indicators are indicating that end demand is holding up well and is running counter to the slowdown exhibited in the national accounts. The report added that India is moving on to the next phase of the business cycle of productive growth - a phase marked by further improvement in growth while macro stability remains in check. Some support also came with taking cues from Sanjeev Sanyal, principal economic advisor’s statement that the government has dropped the idea of setting up a bad bank though solving NPA problem is the top priority for the government right now than consolidation as the government is keen on creating a long-term framework for strong and stable growth. Creating fundamentally strong banks is essential for India’s long-term growth for which resolving NPAs is crucial according to the government.

Investors took note that as many as six lakh more businesses have filed returns and paid taxes in last one week, taking maiden revenue collections from GST to about Rs 94,700 crore. Finance Minister Arun Jaitley had last week stated that 38.38 lakh businesses had filed their returns and paid Rs 92,283 crore in taxes for the month of July - the first month of implementation of independent India’s biggest tax reform, the GST. The upside was, however, capped after a senior official with Securities and Exchange Board of India (SEBI) enlightened that a stronger rupee, often endorsed by the central government, is worrying the capital market regulator. The huge inflow of foreign investments into the country is having an impact on the rupee and regulators need to manage it through a calibrated system. Foreign Portfolio Investors have invested Rs 44,150 crore in Indian equities and Rs 1.29 lakh crore in debt so far this year.

Traders were seen piling up position in Realty, Healthcare and Consumer Disc stocks, while selling was witnessed in Oil & Gas, Power and PSU sector stocks. In scrip specific development, Eicher Motors was trading in green on reports that Siddhartha Lal led company is revving up to make a binding offer to acquire the iconic Italian superbikes Ducati for $1.8 billion-$2 billion -- a move, of successful, will further power its portfolio, brand equity, global reach and access to technology. Hindustan Uniliver was trading in green as the company has commenced commercial production at its personal care products unit at Doomdooma in the state of Assam on September 6, 2017.

On the global front, Asian markets were trading mostly in green, with hopes for a temporary extension of the US debt ceiling. A poll report showed that Japan’s economy likely grew at a slower pace than initially estimated in the second quarter, on expected downward revisions in capital spending growth. Back home, the BSE Sensex and NSE Nifty were trading above the psychological 31,700 and 9,900 levels respectively. The market breadth on BSE was positive in the ratio of 1413:706, while 112 scrips remained unchanged.

The BSE Sensex is currently trading at 31714.90, up by 52.93 points or 0.17% after trading in a range of 31713.01 and 31814.96. There were 19 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.72%, while Small cap index was up by 0.75%.

The top gaining sectoral indices on the BSE were Realty up by 1.12%, Healthcare up by 0.72%, Consumer Disc up by 0.69%, Capital Goods up by 0.58% and FMCG up by 0.58%, while Oil & Gas down by 0.10%, Power down by 0.09%, PSU down by 0.02% and Consumer Durables down by 0.02% were the only losing indices on BSE.

The top gainers on the Sensex were Hero MotoCorp up by 1.30%, Sun Pharma up by 1.19%, Mahindra & Mahindra up by 1.17%, Dr. Reddy’s Lab up by 1.10% and Hindustan Unilever up by 0.78%.

On the flip side, Tata Motors - DVR down by 1.98%, Tata Motors down by 1.75%, NTPC down by 1.15%, Coal India down by 0.47% and HDFC down by 0.46% were the top losers.

Meanwhile, Suresh Prabhu, the newly appointed Commerce & Industry Minister has reiterated the government’s intent to increase the export and has said that his ministry is looking at certain measures to rev up country’s exports in a “shortest possible time” and will also strive to address the issues facing exporters post GST.

The minister said that exports to GDP (gross domestic product) ratio of India has to improve substantially in order to increase capacity utilisation of existing manufacturing units, as the outbound shipments have a great ability to generate economic activity by its own steam and we have to work out what can be done to promote exports in the shortest possible time.

Detailing further the minister said that exporters are facing certain challenges in the GST regime and the ministry is taking up those issues to the concerned authorities and is working on the support measures which can facilitate quick increase in exports both in terms of volume and value. The minister also said that domestic investments by the private sector have not increased considerably and one of the reasons for that is inadequate capacity utilisation.

Prabhu also said that his ministry will work on several other fronts, including bringing in new industrial policy, improving logistics for exporters, agri export policy and integrating into the global supply chains. A mid-term review of the five year Foreign Trade Policy is scheduled to be announced soon.

The CNX Nifty is currently trading at 9936.50, up by 20.30 points or 0.20% after trading in a range of 9936.45 and 9964.85. There were 33 stocks advancing against 18 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing up by 3.54%, Eicher Motors up by 1.92%, Bank of Baroda up by 1.55%, Hero MotoCorp up by 1.36% and Sun Pharma up by 1.29%.

On the flip side, Tata Motors - DVR down by 2.14%, Tata Motors down by 1.55%, BPCL down by 1.46%, NTPC down by 1.15% and Coal India down by 0.55% were the top losers.

The Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 1.37 points or 0.08% to 1,773.85, Hang Seng increased 19.01 points or 0.07% to 27,632.77, KOSPI Index increased 25.86 points or 1.11% to 2,345.68 and Nikkei 225 increased 49.36 points or 0.25% to 19,407.33.

On the other hand, Taiwan Weighted decreased 13.5 points or 0.13% to 10,534.36, Jakarta Composite decreased 10.35 points or 0.18% to 5,813.79 and Shanghai Composite decreased 4.62 points or 0.14% to 3,380.76.