Benchmarks continue firm trade; Nifty holds 10,200 mark

Indian equity benchmarks continued their firm trade in morning session on account of buying in frontline counters. The Indian rupee continued hovering around 65 against the US dollar. It has opened higher against dollar on Tuesday. The street will be eyeing Infosys quarterly results. The country’s second largest software services provider will announce its July-September quarter earnings today after market hours. The outlook will be key thing to watch out for, especially after co-founder Nandan Nilekani joined as non-executive chairman in August. Traders took encouragement with SBI’s report that the government is likely to achieve its fiscal deficit target of 3.2% this financial year as the budgeted disinvestment receipts are on track to realize Rs 72,500 crore. The report noted that the government will able to meet the disinvestment target of Rs 72,500 crore as Rs 60,000 crore has already been achieved and hence the fear of low disinvestment receipts is completely unwarranted.

Separately, a private report highlighted that post-demonetization and implementation of the Goods and Services Tax (GST), the current economic slowdown has bottomed out and the recovery of the economy would critically depend on the initiatives the government takes from now onwards. The report added that the slowdown has bottomed out, however, the stage and pace of recovery would critically depend on the initiatives that the government takes from now onwards to boost the growth momentum, especially the private sector investment. Investors took note that more respite could be on the way Small and Medium Enterprises (SMEs), with the Goods and Services Tax (GST) council set to ease a string of procedures, including partial relief on penalties on late filing of GST returns. The tax department’s proposal, if approved by the GST Council in its next meeting on November 10 on Guwahati, will lessen the struggles of small businesses still grappling to understand the nuances of the new indirect tax system that was rolled out from July 1.

Traders were seen piling up position in Realty, Basic Materials and Metal stock, while selling was witnessed in Healthcare and Capital Goods sector stocks. Infrastructure related stocks were buzzing in today’s trade as the government is set to approve the biggest ever highway development plan to develop and expand approximately 83,000 km of roads at an investment of Rs 6.9 lakh crore by 2022. In scrip specific development, Cochin Shipyard was trading in green as the Ministry of Shipping had approved formation of Joint Venture Company between Cochin Shipyard and Hooghly Dock & Port Engineers for up-gradation and modernization of shipbuilding infrastructure at the two shipyard sites of Salkia and Nazirgunge in Kolkata.

On the global front, Asian markets were trading mostly in green. Japanese manufacturing activity expanded in October at a slower pace than the previous month as output and new orders growth eased in a sign final demand is moderating. Investors are closely watching China and the 19th Communist Party Congress, which winds up on Tuesday and at which President Xi Jinping is expected to release the composition of the Standing Committee - the apex of power in the country. Back home, the BSE Sensex and NSE Nifty were trading above the psychological 32,600 and 10,200 levels respectively. The market breadth on BSE was positive in the ratio of 1470:819, while 104 scrips remained unchanged.

The BSE Sensex is currently trading at 32636.01, up by 129.29 points or 0.40% after trading in a range of 32534.21 and 32670.37. There were 21 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.28%, while Small cap index was up by 0.81%.

The top gaining sectoral indices on the BSE were Realty up by 1.62%, Basic Materials up by 1.35%, Metal up by 1.35%, PSU up by 1.08% and Power up by 1.06%, while Healthcare down by 0.07% and Capital Goods down by 0.05% were the only losing indices on BSE.

The top gainers on the Sensex were ONGC up by 2.80%, NTPC up by 2.60%, Tata Steel up by 1.78%, Hindustan Unilever up by 1.56% and Axis Bank up by 1.13%.

On the flip side, Tata Motors down by 0.99%, Sun Pharma down by 0.87%, Tata Motors - DVR down by 0.55%, Mahindra & Mahindra down by 0.55% and Larsen & Toubro down by 0.33% were the top losers.

Meanwhile, terming new indirect tax as a major reform to make India’s economy better, Union Minister of Minority Affairs Mukhtar Abbas Naqvi said that the Goods and Services Tax (GST) will remain as a Good and Simple Tax in the coming days to come and will prove to be as a better medium for small traders and businessmen.

Naqvi also said that the GST is meant to provide ease of doing business and it is a very big reform of the single window taxation system. He further said that when a country introduces such major reforms, then it is natural to face minor challenges and obstacles. On the probability of diesel, petrol and real estate coming within the ambit of the GST, he said that as and when the suggestions come, the GST Council takes them into consideration.

Union Minister of Minority Affairs said that based on the suggestions and improvements regarding such a major reform, the GST Council is conducting meetings time and again. He added that the resolution of these obstacles is the priority of the government and the GST council and the Finance Minister has himself made improvements in that regard.

The CNX Nifty is currently trading at 10226.50, up by 41.65 points or 0.41% after trading in a range of 10187.85 and 10237.75. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were ONGC up by 3.00%, Vedanta up by 2.52%, NTPC up by 2.46%, Yes Bank up by 2.44% and Tata Steel up by 1.80%.

On the flip side, Tata Motors down by 1.14%, Sun Pharma down by 1.00%, Tech Mahindra down by 0.94%, Power Grid down by 0.89% and IndusInd Bank down by 0.88% were the top losers.

The Asian markets were trading mostly in green; Shanghai Composite increased 1.12 points or 0.03% to 3,381.81, KOSPI Index increased 4.99 points or 0.2% to 2,495.04, Jakarta Composite increased 6.99 points or 0.12% to 5,957.02, Hang Seng increased 11.05 points or 0.04% to 28,316.93, Taiwan Weighted increased 16.31 points or 0.15% to 10,751.52 and Nikkei 225 increased 66.53 points or 0.31% to 21,763.18.

On the other hand, FTSE Bursa Malaysia KLCI decreased 1.19 points or 0.07% to 1,740.28.