Benchmarks make positive start on firm global cues

Indian equity benchmarks have made a positive start and are trading slightly in green in early deals on Monday amid firm global cues. Sentiments remained up-beat on Hasmukh Adhia’s statement that policymakers are considering steps to ease the compliance burden related to the goods and services tax (GST) on small businesses and to make product classification for taxation less complicated. Some support also came with report that foreign investors have poured a whopping $2 billion into the Indian debt markets so far this month due to lower currency volatility coupled with positive real interest rates. However, gains remained capped on report that Foreign portfolio investors (FPIs) however pulled out Rs 3,408 crore ($523 million) from equities on account of profit booking during this period. Traders also remained watchful ahead of October F&O expiry and Infosys Q2 earnings.

Global cues remained supportive with Asian markets trading mostly in green at this point of time, as the dollar spiked to more than three-month highs against the yen following a snap election in Japan on Sunday. The US markets ended on firm note on Friday, as traders remained optimistic on report that Senate Republicans approved a budget resolution that will serve as the legislative vehicle for their tax reform plan.

Back home, port and shipping related stocks remained in action, as Union Minister Nitin Gadkari has said a blueprint of 142 expansion projects has been finalised to modernise 12 major ports and develop new harbours at a cost of about Rs 90,000 crore. Gold and jewellery related stocks were trading mixed on report that India tightened gold import norms for nominated agencies by restricting them from importing the yellow metal only for export purposes and not for selling in the domestic market.

The BSE Sensex is currently trading at 32452.16, up by 62.20 points or 0.19% after trading in a range of 32393.22 and 32614.89. There were 20 stocks advancing against 11 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index gained 0.36%, while Small cap index was down by 0.02%.

The top gaining sectoral indices on the BSE were Energy up by 1.05%, Metal up by 0.85%, Telecom up by 0.80%, Basic Materials up by 0.80% and Oil & Gas was up by 0.77%, while Bankex down by 0.14%, Consumer Disc down by 0.12% and Auto was down by 0.07% were the few losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 2.16%, Adani Ports up by 1.89%, Coal India up by 1.38%, Hero MotoCorp up by 1.36% and Reliance Industries up by 1.24%. On the flip side, Axis Bank down by 1.61%, Bajaj Auto down by 1.34%, HDFC down by 1.28%, Tata Motors - DVR down by 1.08% and Asian Paints down by 0.67% were the top losers.

Meanwhile, nearly four months after the roll out of Goods and Services Tax (GST), Revenue Secretary Hasmukh Adhia has said that a complete overhaul of the tax rates is now required to reduce the burden on small and medium businesses with the new GST regime firmly entrenched. He added that since its introduction, the new indirect tax threw up teething troubles and compliance issues, which the GST Council, the highest decision-making body of the new regime, addressed through several rounds of changes.

Hasmukh Adhia said that it will take about a year to stabilize as GST amalgamates more than a dozen central and state levies like excise duty, service tax and VAT. In order to ease hassles facing medium and small businesses in paying taxes and filing GST returns, he has pointed out various aspects of the new indirect tax regime to make it industry friendly.

However, Adhia has said the overhauling would require some calculations by the fitment committee, which will decide which items need a rationalisation of rate under the GST regime which kicked in from July 1.He said “We are very keen to do it as early as possible, it depends on how much time the fitment committee takes to work on it. They need data, calculate revenue loss. They need various comparisons. But harmonisation has to be done. A complete review has to be done”.

The CNX Nifty is currently trading at 10163.45, up by 16.90 points or 0.17% after trading in a range of 10156.35 and 10224.15. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Ultratech Cement up by 2.30%, Ambuja Cement up by 2.15%, Bharti Airtel up by 2.01%, Adani Ports up by 2.01% and HCL Tech. up by 1.75%. On the flip side, Bharti Infratel down by 2.38%, Axis Bank down by 1.78%, Eicher Motors down by 1.63%, Bajaj Auto down by 1.50% and HDFC down by 1.22% were the top losers.

Asian markets were trading mostly in green; KOSPI Index rose 0.34 points or 0.01% to 2,489.88, Shanghai Composite gained 0.79 points or 0.02% to 3,379.44, FTSE Bursa Malaysia KLCI increased 3.35 points or 0.19% to 1,744.00, Taiwan Weighted jumped 15.98 points or 0.15% to 10,744.86, Jakarta Composite added 25.49 points or 0.43% to 5,955.04 and Nikkei 225 was up by 249.02 points or 1.16% to 21,706.66.

On the flip side, Hang Seng was down by 191.4 points or 0.67% to 28,295.84.