Benchmarks trade in fine fettle; Nifty reclaims 10K mark

Indian equity benchmarks, despite a cautious start, have gained momentum and are trading in fine fettle in early deals on Monday, with frontline gauges recapturing their crucial 10,000 (Nifty) and 31,900 (Sensex) levels, ahead of start of July-September earning slated to be released this week. However, gains remained capped on geopolitical concern after report emerged that North Korea to mark a major anniversary this week may do another missile test. Traders also took note of Revenue Secretary Hasmukh Adhia’s statement that the government will clear pending GST refunds of exporters by November-end and over the next six months no tax will be levied on exports as the Council has decided to revert to the pre-GST era.

On the global front, Asian markets were trading mostly in green at this point of time led by over a percent rise in Chinese market which opened on Monday after a week-long break. However, liquidity was lacking with Japan and South Korea remained shut for the trade today. The US markets made mostly a lower closing on a mixed jobs data in the last session. Back home, there was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too participated in the rally. The market breadth remained in favor of advances, as there were 1,510 shares on the gaining side against 581 shares on the losing side while 71 shares remain unchanged.

The BSE Sensex is currently trading at 31926.54, up by 112.32 points or 0.35% after trading in a range of 31781.75 and 31935.63. There were 21 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.55%, while Small cap index was up by 0.76%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.94%, Metal up by 0.93%, Basic Materials up by 0.91%, Industrials up by 0.75% and Capital Goods up by 0.74%, while there were no losing indices on the BSE sectoral front.

The top gainers on the Sensex were Tata Motors - DVR up by 1.63%, Cipla up by 1.41%, Coal India up by 1.37%, Tata Steel up by 1.34% and Tata Motors up by 1.32%. On the flip side, Power Grid down by 1.03%, Adani Ports down by 0.75%, ONGC down by 0.63%, Reliance Industries down by 0.37% and HDFC down by 0.23% were the top losers.

Meanwhile, providing relief to thousands of small and medium enterprises (SMEs) and exporters, the Goods and Services Tax (GST) Council, three months after the rollout of the new indirect tax regime has made sweeping changes on filing and payment of taxes, by easing rules for exporters and cutting tax rates on more than two dozen items. At its 22nd meeting, GST Council, headed by Finance Minister Arun Jaitley, raised the turnover threshold composition scheme to Rs 1 crore from Rs 75 lakh, along with allowing quarterly filing of returns for businesses with turnover up to 1.5 crore .

Under the composition scheme, businesses pay a fixed rate to avoid GST paperwork. The higher thresholds will ease the compliance burden and also reduce the filing load on the system. In composition scheme, taxpayers are classified under three categories based on the GST rates they pay - traders pay 1% GST, manufacturers 2% and 5% for suppliers of food or drinks for human consumption (without alcohol). Service providers cannot opt for the composition scheme. Moreover, taxpayers which are exempt from composition scheme but annual turnover up to Rs 1.5 crore will file their GST returns on quarterly basis instead of the current provision of monthly filings.

The Council has decided to clear all tax refund claims of exporters for July by October 10 and for August by October 18. It introduced a 0.1% GST rate for merchant exporters, offering relief from the full applicable GST rates on their procurements. Moreover, exporters will get Interstate GST (IGST) relief till March 31, 2018. From April 1, the government is planning to launch an e-wallet facility for the exporters to give them refund for GST paid which will solve their liquidity problems.

The goods which saw a decline in GST rates include sliced dried mangoes (5%), khakra and plan chapati (5%), ICDS food packets (5%), unbranded namkeen (5%), unbrabded ayurvedic medicines (5%), plastic waste (5%), rubber waste (5%), paper waste (5%), manmade yarn (12%), flooring stones expect marble and granite (18%), stationary items (18%), clips (18%), diesel engine parts (18%), pumps parts (18%), and e-waste (5%). Moreover, job works related to zari embroidery, imitation jewellery, food items, printing, and government contracts involving high element of labour will all attract GST at the rate of 5%.

The CNX Nifty is currently trading at 10014.75, up by 35.05 points or 0.35% after trading in a range of 9959.45 and 10015.40. There were 37 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were Cipla up by 1.68%, Ultratech Cement up by 1.43%, Tata Steel up by 1.37%, Coal India up by 1.28% and Tata Motors up by 1.21%. On the flip side, Power Grid down by 1.12%, Adani Ports down by 0.96%, ONGC down by 0.63%, HCL Tech down by 0.55% and Reliance Industries down by 0.48% were the top losers.

Asian markets were trading mostly in green; Jakarta Composite rose 4.29 points or 0.07% to 5,909.66, FTSE Bursa Malaysia KLCI gained 0.13 points or 0.01% to 1,764.13 and Shanghai Composite was up by 41.57 points or 1.24% to 3,390.51. On flip side, Hang Seng was down by 85.49 points or 0.3% to 28,372.55.