Markets trade at highest point of the day; Nifty above 10K mark

Indian equity benchmarks extended their early gains in late morning session and were trading at the highest point of the day, tracking positive Asian cues. Sentiments remained optimistic with the outcome of the crucial meeting of the Goods and Services Tax (GST) Council that took place on Saturday, where the council cut GST rate for over 40 items of mass consumption. Some support also came with the Federation of Indian Export Organizations’ (FIEO) statement that the decision of the GST Council to reduce the rate on supply of various scrips from 12 per cent to 5 per cent, will give a boost to the exports sector. Investors also took some support with the private report stating that India’s trade deficit is expected to improve in August to about USD 10.3 billion from USD 11.5 billion in July, largely on moderation in export as well as import growth. Meanwhile, foreign investors have pulled out close to Rs 3,000 crore from equities in the first week of this month amid ‘lacklustre earnings season’ as well as tensions between the US and North Korea over the latter's nuclear programme.

On the global front, Asian markets were trading mostly in green amid improved risk appetite on reduced expectations of another interest rate hike by the US Federal Reserve and as North Korea did not conduct a missile test over the weekend despite speculation that it would do so. Back home, in scrip specific development, Tata Motors surged after the company launched a sedan variant of its hatchback Tigor. The Tigor XM petrol is priced at Rs 4.99 lakh. Introduction of this variant will further strengthen the sedan portfolio and will provide customers with a feature-rich car at an exciting price point. The new car will be available in petrol and diesel fuel types with manual transmission from September 15.

The BSE Sensex is currently trading at 31916.43, up by 228.91 points or 0.72% after trading in a range of 31797.89 and 31916.43. There were 25 stocks advancing against 6 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.94%, while Small cap index was up by 0.85%.

The top gaining sectoral indices on the BSE were Capital Goods up by 2.07%, Industrials up by 1.39%, Oil & Gas up by 1.35%, Utilities up by 1.20% and Power up by 1.08%, while Telecom down by 0.15%, TECK down by 0.06% and IT down by 0.05% were the few losing indices on BSE.

The top gainers on the Sensex were Larsen & Toubro up by 2.64%, Tata Motors - DVR up by 2.00%, HDFC Bank up by 1.73%, Maruti Suzuki up by 1.68% and Hindustan Unilever up by 1.43%. On the flip side, Infosys down by 0.72%, SBI down by 0.57%, Bharti Airtel down by 0.17%, TCS down by 0.14% and Power Grid Corporation down by 0.05% were the top losers.

Meanwhile, Union Finance Minister Arun Jaitley has said that it is a big challenge for banks to recover money from big defaulters and has blamed these big defaulters for high non-performing assets (NPAs) in the Indian banking system. He noted that wherever small borrowers are taking loans from banks, there is smaller NPA. He also explained that NPAs are negligible in the banks where smaller amount of loans taken for agricultural and smaller businesses and even in MUDRA scheme, the NPAs are on a minuscule scale.

The Minister has stated that banks have always played an important role in promoting economic growth of a country. Therefore, he said that it is important for banks to maintain their credibility. Adding further, he said that banks offer loans for different purposes but if the banks’s capacity to offer the loans gets affected because some big defaulter people, the growth, not only of rural sector, but of the entire country gets affected.

Jaitley further said that for the first time, the central government is taking steps to take these big defaulters to insolvency so that the recovery can be made and that money can be utilised for the growth of the rural sector. Praising the efforts of the Pune District Central Cooperative Bank (PDCC Bank) for sustained good performance of the bank, he said that the model of PDCC Bank should be replicated in other parts of the country.

The CNX Nifty is currently trading at 10002.55, up by 67.75 points or 0.68% after trading in a range of 9968.80 and 10003.15. There were 39 stocks advancing against 12 stocks declining on the index.

The top gainers on Nifty were GAIL India up by 4.87%, Tata Power up by 2.73%, Larsen & Toubro up by 2.65%, Tech Mahindra up by 2.18% and Hindustan Unilever up by 1.66%. On the flip side, Vedanta down by 0.67%, Infosys down by 0.60%, Bharti Infratel down by 0.45%, SBI down by 0.42% and Indiabulls Housing Finance down by 0.37% were the top losers.

Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 1.85 points or 0.1% to 1,781.75, Shanghai Composite increased 6.95 points or 0.21% to 3,372.20, KOSPI Index increased 12.82 points or 0.55% to 2,356.54, Jakarta Composite increased 17.63 points or 0.3% to 5,874.75, Nikkei 225 increased 261.18 points or 1.36% to 19,536.00 and Hang Seng increased 263.56 points or 0.95% to 27,932.03.

On the flip side, Taiwan Weighted decreased 37.79 points or 0.36% to 10,572.16.