The Indian markets after a lackluster trade and paring all the early gains made a flat closing in the last session, as mixed earnings results prompted traders to book some profits at higher levels. Today, the start of the new data heavy week is likely to be flat-to-cautious and traders will be reacting to the meeting outcome of the ministerial panel working to make GST composition scheme more attractive, which suggested slashing tax rate to 1 per cent for manufacturers and restaurants, while easier norms for traders opting for it. Traders will also be eyeing the urgent meeting of the ministry of corporate affairs to discuss if there are 'grey areas' in the Companies Act that needs to be addressed, after several directors went to courts against their debarment by the government. The ministry in September cancelled registration of over 200,000 defaulting companies and, by extension, it had also debarred over 300,000 directors of companies. There will be some buzz in the auto sector stocks too as the Union road transport ministry has approved the timeline for the implementation of system which requires all cars manufactured after July 1, 2019, to be equipped with airbags, seat-belt reminders, alert systems for speeds beyond 80kmph, reverse parking alerts, as well as manual override over the central locking system for emergencies.
The US markets moved higher in the last session and the tech-heavy Nasdaq and the S&P 500 climbed to new record closing highs. The gains were in reaction to upbeat earnings news from several well known companies and a report from the Commerce Department showing stronger than expected economic growth in the third quarter. The Asian markets have made mostly a higher start following Wall Street close at fresh record highs on Friday. Though, the Chinese market was cautious despite its industrial profit growth accelerating further in September.
Back home, Profit booking which took place in last leg of trade played spoil sport for the Indian equity benchmarks and pulled them to end flat on Friday. Key gauges made a positive start and traded mostly in green but in tight band throughout the session, as traders taking encouragement with credit rating agency Fitch’s report that the recent recapitalisation plan announced by the government for public sector banks will provide substantial funds to the lenders to address the capital shortages that has a major negative impact on their ratings. Meanwhile, markets regulator SEBI revising the framework for 'block deals' by providing two separate trading windows of 15 minutes each and increasing the minimum order size to Rs 10 crore. The move is aimed at ensuring confidentiality of the large trades and stable prices for such transactions. Adding to the optimism, Department of Industrial Policy and Promotion (DIPP) Secretary Ramesh Abhishek expressed hope that India’s ranking is likely to improve significantly in the World Bank’s ease of doing business report, as they have worked very hard. The government’s optimism regarding the improvement in India’s rank comes on the back of reforms taken to improve the efficiency in granting construction permits, starting a business and resolving insolvency. Sentiments also got some support with Niti Aayog CEO Amitabh Kant’s statement who pitched for channeling insurance and pension funds for financing infrastructure projects as also for a complete re- examination of the Viability Gap Funding (VGF) scheme. However, markets witnessed sharp selloff in final hour of trade, with traders opting to book all of their initial profit to pull benchmarks lower and end mixed with negative bias. Finally, the BSE Sensex rose 10.09 points or 0.03% to 33,157.22, while the CNX Nifty was down by 20.75 points or 0.20% to 10323.05.
