Sensex, Nifty hold gaining momentum; Auto, Energy stocks surge

Indian equity benchmarks maintained their gaining momentum in late morning session, on account of sustained buying in Consumer Durables, Auto and Metal stocks amid firm Asian markets. Sentiments remained upbeat with Finance Minister Arun Jaitley’s statement that net collections till September 18 of this fiscal grew 15.7% to Rs 3.7 lakh crore. The number of taxpayers rose to 6.26 crore in 2016-17 from 4.72 crore in 2012-13. The indices took some support with report that manufacturing activity in India showed a modest improvement in September supported by increases in both output and new orders. The Nikkei India Manufacturing Purchasing Managers’ Index, or PMI, remained unchanged at 51.2 in September. Traders paid no heed towards the global ratings agency, Fitch Ratings’ latest report which has trimmed its forecast for India’s economic growth in 2017-18 by half a percentage point to 6.9% from its earlier projection of 7.4%.  Meanwhile, India's external debt increased 3 percent to $485.8 billion at June-end over the previous quarter, mainly due to increase in the inflow of foreign portfolio investment into domestic capital market's debt segment.

On the global front, Asian markets were trading in green following fresh records on Wall Street, with investors cheered by the release of strong economic data. Back home, in scrip specific development, Oil & Natural Gas Corporation (ONGC) gained on getting clearance for Rs 456 crore exploratory drilling project in Assam.

The BSE Sensex is currently trading at 31546.31, up by 262.59 points or 0.84% after trading in a range of 31440.48 and 31615.28. There were 23 stocks advancing against 7 stocks declining on the index, while 1 stock remained unchanged.

The broader indices were trading in green; the BSE Mid cap index was up by 1.06%, while Small cap index was up by 0.92%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.51%, Auto up by 1.43%, Energy up by 1.39%, Metal up by 1.19% and FMCG up by 1.17%, while there were no losers on the BSE sectoral front.

The top gainers on the Sensex were Tata Motors - DVR up by 5.31%, Tata Motors up by 4.30%, Asian Paints up by 3.40%, Bajaj Auto up by 2.65% and Reliance Industries up by 2.32%. On the flip side, Power Grid Corporation down by 1.59%, Maruti Suzuki down by 1.00%, SBI down by 0.65%, Larsen & Toubro down by 0.51% and Kotak Mahindra Bank down by 0.22% were the top losers.

Meanwhile, ahead of the goods and services tax (GST) Council meet on October 6, Union Finance Minister Arun Jaitley has hinted that there is scope for reducing the tax slabs under the new tax regime and also said that there is a need to ease compliance burden on small taxpayers. Noting that there is space and scope for improvement, he said, “Eventually once we become revenue neutral to think in terms of bigger reforms such as lesser slabs…But for that, we have to become revenue neutral plus.”

The minster has stated that currently, under the GST, items are slotted under rates of 5, 12, 18 and 28 percent, plus a levy on cesses on luxury items like cars, aerated drinks and tobacco products to compensate states for any revenue losses in the first five years. Stressing that indirect tax burden is borne by all sections of the society, he said it was always the endeavour of the government to bring down tax rates on mass consumption commodities. Adding further, he noted that direct tax is paid by more by the more affluent, somewhat by the others and certainly not by the weaker section but the impact of indirect tax places burden on all.

Therefore, Jaitley pointed out that efforts are always made in the fiscal policy to ensure that the commodities which are used largely by consumers are least taxed as indirect tax puts burden on everyone. Noting that India has conventionally been a tax non-compliant society, he said when people have the right to demand development, they also have the responsibility to pay what is required for the development.

The CNX Nifty is currently trading at 9864.25, up by 75.65 points or 0.77% after trading in a range of 9831.05 and 9895.40. There were 40 stocks advancing against 10 stocks declining on the index, while 1 stock remained unchanged.

The top gainers on Nifty were Tata Motors up by 4.21%, GAIL India up by 3.31%, Indiabulls Housing Finance up by 2.81%, Bajaj Auto up by 2.57% and Reliance Industries up by 2.48%. On the flip side, Power Grid Corporation down by 1.71%, Maruti Suzuki down by 1.08%, SBI down by 0.73%, Larsen & Toubro down by 0.62% and HPCL down by 0.47% were the top losers.

Asian markets were trading in green; FTSE Bursa Malaysia KLCI increased 2.81 points or 0.16% to 1,757.59, Taiwan Weighted increased 4.19 points or 0.04% to 10,469.35, Jakarta Composite increased 19.32 points or 0.33% to 5,933.35, Nikkei 225 increased 202.67 points or 0.99% to 20,603.45 and Hang Seng increased 512.44 points or 1.86% to 28,066.74.

The markets in South Korea and China are closed, for the Harvest Festival and National Day, respectively.