Markets trim gains; Nifty holds 10300 mark

Key Indian benchmarks trimmed most of the gains in late morning session due to a fresh spell of selling in Metal, Utilities and Auto stocks amid weak Asian markets. Traders turned cautious with Grant Thornton’s latest International Business Report (IBR) highlighting that India slipped to the 7th position in the September quarter from the 2nd spot in the previous three months in its ‘business optimism index’, showing clear signs of lag in the economy. Investors were also taking note of the finance ministry’s statement that raising the individual limit of foreign investment up to 15% in power exchanges would be unwise unless a clear business case is established and a strong and adequate regulatory mechanism exists. Though the indices pared gains, they managed to trade above neutral line with taking support from the joint study of Assocham and Resurgent which stated that India's textiles sector is likely to touch $ 250 billion in the next two years from the current level of $ 150 billion.

On the global front, Asian markets were trading mostly in red, despite the modest gains overnight on Wall Street. The yen and gold climbed as investors kept an eye on US President Donald Trump’s visit to China. Back home, in scrip specific development, Allahabad Bank was trading higher after the bank successfully raised Additional Tier 1 (AT 1) Capital of Bank through Private Placement of AT 1 Perpetual Bonds Series III aggregating to Rs 600.00 crore at an annual coupon of 9.34% p.a., discovered through Electronic Bidding Mechanism of NSE (NSE EBP).
 
The BSE Sensex is currently trading at 33248.12, up by 29.31 points or 0.09% after trading in a range of 33230.88 and 33463.80. There were 18 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.46%, while Small cap index was up by 0.31%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.00%, Energy up by 1.00%, Telecom up by 0.54%, Oil & Gas up by 0.45% and Capital Goods up by 0.38%, while Auto down by 0.28%, Metal down by 0.27%, Utilities down by 0.26%, Realty down by 0.22% and Healthcare down by 0.21% were the top losing indices on BSE.

The top gainers on the Sensex were Asian Paints up by 1.93%, Reliance Industries up by 1.89%, ICICI Bank up by 1.42%, Hindustan Unilever up by 1.33% and NTPC up by 1.22%. On the flip side, Coal India down by 1.98%, HDFC down by 1.66%, Power Grid Corporation down by 1.53%, ITC down by 1.04% and Maruti Suzuki down by 1.02% were the top losers.

Meanwhile, a study carried out by Centre for Digital Financial Inclusion (CDFI) has indicated that the government’s move to demonetise Rs 500 and Rs 1,000 currency notes has broadened the scope for digitisation with around 63 percent retailers in rural as well as urban India willing to use digital payments such as mobile payments and card payments. The study, which was done in two stages i.e. pre-demonetisation and post-demonetisation, found growing acceptance of digital transaction among retailers before note ban. However, it observed that after note ban, more and more small traders showed their willingness to adopt the new payment gateways.

The study further showed that till March 2017, the actual cashless transaction was only 11 percent, though the interview showed 63 percent retailers willing for it. It also noticed that there was 11 percent digital transaction across the board, whether rural or urban areas and the perception has changed substantially with large number of people willing to embrace it. Adding further, it noted that as note ban pushed the demand for cashless transaction, finance minister Arun Jaitley announced that additional 10 lakh point-of-sale would be made available in the market. It also highlighted that the country had 94 percent mobile users of which 41 percent people had smart phone, which was a good sign to adopt cashless payment.

The CDFI further said that the road to digital transaction was faced with many challenges, and citied that opening the current accounts was still a complicated process. It was also noted that a fear existed among retailers that usage of digital platform would bring them in the tax net. Therefore, it pointed out that the fear could be countered by carrying out awareness campaign. It also feels that more digital interface would help create a transaction history for the small retailers and enable them to get loans from banks. It added that this would pave way for more entrepreneurs emerging from different parts of the country.

The CNX Nifty is currently trading at 10315.10, up by 11.95 points or 0.12% after trading in a range of 10304.45 and 10368.45. There were 28 stocks advancing against 22 stocks declining on the index.

The top gainers on Nifty were Reliance Industries up by 2.10%, Asian Paints up by 1.97%, HPCL up by 1.76%, Hindustan Unilever up by 1.71% and Indiabulls Housing Finance up by 1.68%. On the flip side, Coal India down by 2.48%, HDFC down by 1.83%, GAIL India down by 1.51%, Aurobindo Pharma down by 1.45% and Zee Entertainment down by 1.42% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 decreased 233.97 points or 1.02% to 22,679.85, Taiwan Weighted decreased 75.72 points or 0.7% to 10,743.27, KOSPI Index decreased 13.31 points or 0.52% to 2,539.09, Jakarta Composite decreased 6.69 points or 0.11% to 6,042.69 and Shanghai Composite decreased 5.99 points or 0.18% to 3,409.47.

On the flip side, FTSE Bursa Malaysia KLCI increased 3.16 points or 0.18% to 1,747.36 and Hang Seng increased 59.66 points or 0.21% to 28,967.26.