Benchmarks continue firm trade in morning session

Indian equity benchmarks continued their firm trade in the morning session on account of buying in frontline blue chip counters tracking positive global cues. The rupee opened higher against dollar on account of selling of American currency by banks and exporters amid firm global cues. Foreign Portfolio Investors stood net sellers in secondary markets on Friday and sold shares worth Rs 1,235.30 crore with gross purchases and gross sales of Rs 3,716.46 crore and Rs 4,951.76 crore, respectively. Traders took support with foreign brokerage report that India is likely to overtake Japan and Germany to become the third largest economy in the next 10 years but needs to be consistent in reforms and focus more on the social sector. Demographics and macro stability were pointed out as key strengths for the country by the brokerage. Its estimates show India will be a $7 trillion economy in 2028, as compared to less than $6 trillion and $5 trillion for Germany and Japan, respectively. Investors also took note that Commerce and Industry minister Suresh Prabhu will soon meet the country’s top industrialists individually to seek an investment commitment from each of them for the next few years. The minister will hold one on one meeting with the heads of top 30 domestic companies, followed by group meetings, next month.

The markets shrugged off the report that trade deficit in the month of August widened to $11.64 billion from $7.7 billion during the same month a year ago. India’s exports rose 10.29 percent on a yearly basis to $23.81 billion in August on account of rise in shipments of engineering, petroleum, chemicals and pharmaceuticals products. Imports too increased 21.02 percent to $35.46 billion in August from $29.30 billion in the year-ago month due to rise in inward shipments of crude oil and gold. Select steel companies were under pressure after the government asked steelmakers to make efforts to keep prices below Rs 40,000 per tonne as it cannot permit them to exploit the country. The best range for domestic price is between Rs 35,000 per tonne to Rs 40,000 per tonne.

Traders were seen piling up position in Capital Goods, Telecom and Industrials stocks, while selling was witnessed in Healthcare sector stocks. In scrip specific development, consumer electronics manufacturer Dixon Technologies made a strong debut on bourses as the stock opened up 54% over its issue price of Rs 1,766. Bharat Road Network had a tepid listing as in the opening tick, the scrip traded flat against the higher end of the price band of Rs 205. Dixon Technologies’ IPO was subscribed 117.83 times during September 6-8. The IPO of Bharat Road Network was subscribed 1.81 times during September 6-8.

On the global front, Asian markets were trading mostly in green. There was relief the weekend passed with no new provocation by North Korea, though Pyongyang’s nuclear ambitions will be centre stage when US President Donald Trump addresses world leaders at the United Nations on Tuesday. Back home, the BSE Sensex and NSE Nifty were trading above the psychological 32,400 and 10,150 levels respectively. The market breadth on BSE was positive in the ratio of 1525:673, while 113 scrips remained unchanged.

The BSE Sensex is currently trading at 32469.17, up by 196.56 points or 0.61% after trading in a range of 32361.25 and 32508.06. 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 0.88%, while Small cap index was up by 1.00%.

The top gaining sectoral indices on the BSE were Capital Goods up by 1.77%, Telecom up by 1.62%, Industrials up by 1.38%, Auto up by 1.29% and Power up by 1.10%, while Healthcare down by 0.39% was the sole losing indices on BSE.

The top gainers on the Sensex were Bajaj Auto up by 3.01%, Larsen & Toubro up by 2.49%, Tata Motors - DVR up by 2.07%, Tata Motors up by 1.51% and NTPC up by 1.40%.

On the flip side, Sun Pharma down by 1.81%, Dr. Reddy’s Lab down by 0.69%, ONGC down by 0.69%, Tata Steel down by 0.66% and Lupin down by 0.31% were the top losers.

Meanwhile, the five-member group of ministers (GoM), to review the functioning of the IT network for the Goods and Services Tax (GST) and led by Bihar Deputy Chief Minister Sushil Modi, after its first meeting has set timelines for fixing the issues affecting the GSTN (Goods & Services Tax Network). While government has said that glitches encountered by taxpayers were due to overload on the system, businesses have complained about the frequent breakdowns in the IT network.

Modi said that the grouping had extensive interaction with executives of Infosys, which is providing the IT support for the portal, and businesses will notice a “lot of difference” on the GSTN portal in the next 7-10 days. He added that over 25 issues have been identified which needs to be resolved and timelines have been set for each of them. Overall we are satisfied with the performance of GSTN and Infosys is doing its best to make it error free. Infosys will appoint technical teams in all states under a nodal officer to sort out problems dogging the network.

The GoM decided to set timelines for fixing 20-25 issues that have been identified as impacting the smooth functioning of the IT network and said that a large chunk of issues being faced by taxpayers would be resolved by the end of October.

The GoM which has members other than Modi including Kerala Finance Minister Thomas Isaac, Chhattisgarh Minister of Commercial Taxes Amar Agrawal, Karnataka Agriculture Minister Krishna Byre Gowda and Telangana Finance Minister Etela Rajender, was constituted on September 12 after the GST Council decided to sort out technical glitches. The GSTN website had faced glitches last month as taxpayers flogged to the portal on the last day of the deadline of filing returns for July.

The CNX Nifty is currently trading at 10159.30, up by 73.90 points or 0.73% after trading in a range of 10131.30 and 10167.15. There were 43 stocks advancing against 8 stocks declining on the index.

The top gainers on Nifty were Bajaj Auto up by 2.85%, Bharti Infratel up by 2.78%, Larsen & Toubro up by 2.50%, Tata Motors - DVR up by 2.45% and IndusInd Bank up by 2.22%.

On the flip side, Sun Pharma down by 2.07%, Dr. Reddy’s Lab down by 0.80%, Aurobindo Pharma down by 0.73%, Lupin down by 0.60% and Tata Steel down by 0.60% were the top losers.

The Asian markets were trading mostly in green; Shanghai Composite increased 11.29 points or 0.34% to 3,364.91, KOSPI Index increased 28.61 points or 1.2% to 2,414.68, Taiwan Weighted increased 47.69 points or 0.45% to 10,628.10 and Hang Seng increased 283.45 points or 1.02% to 28,091.04.

On the other hand, Jakarta Composite decreased 4.3 points or 0.07% to 5,868.09 and FTSE Bursa Malaysia KLCI decreased 0.65 points or 0.04% to 1,785.68.

Japan markets are closed for a public holiday.