Benchmarks make positive start; Nifty reclaims 9,950 mark

Indian equity benchmarks have made a positive start with frontline gauges recapturing their crucial 31,700 (Sensex) and 9,950 (Nifty) levels in early deals on Friday. Traders took some support with report that capital markets regulator, the Securities and Exchange Board of India (Sebi) has proposed compulsory physical settlement in stock derivatives contracts and has sought comments from market participants in a discussion paper, as it is concerned over the suitability of derivatives for retail investors. However, gains remained capped with Sebi imposing an Rs 2,423 crore penalty on PACL and its four directors for illegal fund mobilisation through various schemes that were used by the group to garner over Rs 49,000 crore from the public.

On the global front, the Asian markets were exhibiting mixed trend at this point of time and some of the indices were down by over a quarter percent after ECB President Mario Draghi cautioned on the common currency’s strength though didn’t expand on any action to address it. The US markets made mostly lower closing in the last session.

Back home, steel stocks auto stocks remained on buyers’ radar on report that Finance Minister Arun Jaitley is ‘seriously’ considering the demand of automobile manufacturers which have raised concerns over rise in cess on luxury vehicles. Steel stocks also edged higher despite Trump administration’s statement that it will initiate new anti-dumping and countervailing duty probe to determine whether imports of stainless steel flanges from India and China are being dumped in the US.

The BSE Sensex is currently trading at 31735.13, up by 72.39 points or 0.23% after trading in a range of 31694.15 and 31763.70. There were 20 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.45%, while Small cap index was up by 0.65%.

The top gaining sectoral indices on the BSE were Metal up by 1.35%, Basic Materials up by 0.92%, Capital Goods up by 0.83%, Industrials up by 0.74% and FMCG was up by 0.70%, while Energy down by 0.09% was the lone losing index on BSE.

The top gainers on the Sensex were Larsen & Toubro up by 1.38%, Tata Steel up by 1.36%, Cipla up by 0.73%, Tata Motors up by 0.73% and ITC up by 0.68%. On the flip side, Mahindra & Mahindra down by 0.72%, NTPC down by 0.53%, Infosys down by 0.45%, Sun Pharma down by 0.42% and Reliance Industries down by 0.31% were the top losers.

Meanwhile, Union Heavy Industries Minister Anant Geete has said that Finance Minister Arun Jaitley is seriously considering the demand of automobile manufacturers, who raised concerns over hike in Goods and Services Tax (GST) cess on luxury vehicles, following the Union Cabinet approval of the promulgation of an Ordinance that would allow the GST Council to hike the maximum rate of compensation cess on large and luxury vehicles to 25% from the current cap of 15%.

Luxury vehicle manufacturers will be hit hard with the move to hike cess on large cars and sports utility vehicles (SUVs) to 25%, saying it was against the spirit of liberal market dynamics and would affect future plans of expansion under Make in India initiative. Geete said that industry has given its memorandum and the ministry has forwarded that to the finance minister, who he is seriously considering that.

The Minister also said that the ministry has given six months extension to FAME India (Faster Adoption and Manufacturing of Hybrid & Electric Vehicles in India) Scheme as the government is promoting hybrid and electric cars. The main cost of electric car is lithium battery, so they are trying to see how they can cut the battery price. He added that the government is committed to supporting the sector in all possible way and added that the sector is moving from BS-IV to BS-VI emission norms.

The CNX Nifty is currently trading at 9956.25, up by 26.35 points or 0.27% after trading in a range of 9946.60 and 9963.60. There were 36 stocks advancing against 15 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 1.86%, Vedanta up by 1.71%, Tata Steel up by 1.63%, Larsen & Toubro up by 1.14% and Tata Power up by 1.10%. On the flip side, BPCL down by 1.00%, Mahindra & Mahindra down by 0.79%, NTPC down by 0.65%, Sun Pharma down by 0.48% and Infosys down by 0.47% were the top losers.

Asian markets were trading mixed; Nikkei 225 dropped 85.14 points or 0.44% to 19,311.38, FTSE Bursa Malaysia KLCI decreased 6.28 points or 0.35% to 1,776.70, KOSPI Index shed 2.34 points or 0.1% to 2,343.85 and Jakarta Composite was down by 2.1 points or 0.04% to 5,830.21.

On the flip side, Shanghai Composite increased 8.18 points or 0.24% to 3,373.68, Taiwan Weighted gained 40.04 points or 0.38% to 10,578.55 and Hang Seng was up by 166.92 points or 0.61% to 27,689.84.