Markets to extend the gaining streak with a positive start

The Indian markets despite losing some strength in the final hours managed a decent closing in the last session, extending their gaining streak for the fourth day. Today, the start is likely to be in green on firm global cues. On the domestic front traders will be getting some encouragement with report that GST tax returns filed increased. Filings of the summary returns GSTR-3B - with which the tax needs to be paid or nil liability claimed - have increased over the months since July. Till the August 20 deadline for filing GSTR-3B for the month of July without fine, 34 lakh returns were filed; the returns filed before the respective deadline for September was higher at 39.4 lakh and the number for October grew further to 43.7 lakh. Traders will also be getting some support with report that earnings of companies in the September quarter surprised investors and analysts, who almost doubled their upgrade ratings on the stocks they cover after the results. There will be buzz in the telecom stocks, as in a move that promotes optimum spectrum efficiency and utilisation as well as encourages consolidation in the sector, the Telecom Regulatory Authority of India (TRAI) has recommended the removal of the intra-band cap of 50% spectrum holding by operators in a circle.

The US markets surged in the last session and the major averages reached new record closing highs. Upbeat earnings news from several well-known companies and bigger than expected jump in existing home sales in the month of October, led the gains in the market. The Asian markets have made a jubilant start with most of the indices showing gains of over half a percent in early deals, buoyed by fresh all-time highs for US equities with investors energized by the outlook for profits and tax reform.

Back home, Indian equity benchmarks extended their gaining streak for fifth straight day and settled with a gain of around one third of a percent amid sanguine global cues. Markets traded in fine fettle throughout the session, though markets ended off day highs on late hour profit booking. Sentiments remained up-beat since beginning of the trade with traders taking support with international rating agency Moody’s report which expecting growth to revive next year, has said a 7.6% GDP expansion can result in corporates reporting a pre-tax profit growth of 5-6% over the next 12-18 months. The rating agency over the weekend had revised upwards sovereign ratings to Baa2 after almost 14 years. According to the rating agency, growth will “rebound strongly in 2018 because the supply chain disruptions of 2017 will end soon”. Some support also came with report that investors pumped over Rs 51,000 crore into various mutual fund schemes in October after pulling out more than Rs 16,000 crore in the preceding month. Market participants also took some encouragement with chief economic adviser Arvind Subramanian hinting that the government may combine the 12% and 18% slabs under the goods and services tax (GST) into one in the near future and reserve the 28% rate only for demerit goods. Investors took note that the government has moved a notch closer to achieving its disinvestment target through minority stake sales in state-run companies as it has garnered around Rs 14,500 crore through its latest offering - the Bharat-22 Exchange Traded Fund (ETF). The Bharat-22 ETF, which comprises shares of 22 firms, was oversubscribed four times and saw bids of nearly Rs 32,000 crore coming in, with foreign institutional investors (FII) putting in nearly one-third of the amount bid. Finally, the BSE Sensex surged 118.45 points or 0.36% to 33,478.35, while the CNX Nifty was up by 28.15 points or 0.27% to 10,326.90.